What Is Quality of Earnings? Quality of earnings refers to the portion of income realized from a company’s core operations that generate sustainable free cash flow. The quality of a corporation’s earnings is revealed by excluding data that may affect the true bottom-line performance. For example, abnormalities, accounting deception, or […]
What Is Other Comprehensive Income? Net income and other comprehensive income (OCI) are both included in comprehensive income on the Income Statement. However, OCI is made up of revenues, expenses, profits, and losses that are to be included in comprehensive income but not in net income. In business accounting, other […]
What Is Tax Planning? Tax planning refers to financial planning aimed at reducing tax liabilities and optimally utilizing tax exemptions, rebates, and tax benefits to the full extent allowed by law. Tax-efficient investing requires the review of one’s financial situation from a tax perspective. The objective is to ensure that […]
What Is Short Interest? Can Investors Use It to Profit? What is short interest? The term refers to the number of shares that have been sold short against a stock or security but have not yet been covered or closed out. The value can be stated numerically or as a […]
What Is Unearned Income? Unearned income is also referred to as passive or deferred income. It is income from investments and other sources unrelated to direct employment or owning a business. For example, earned income comes from working a regular job providing a product or service and receiving compensation in […]
PIPE Investors – Private Investment in Public Equity (PIPE) Private investment in public equity (PIPE) refers to PIPE investors buying a block of newly issued stock from a publicly-traded company. Usually, at a price below the current market value. This purchasing strategy is used by investment firms, mutual funds, and […]