Question
Why can non-GAAP measures fall lower on the quality spectrum than GAAP earnings?
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Answer
They may exclude real economic costs and bias performance upward.
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Question
Why should an analyst compare pro forma earnings with GAAP earnings over multiple periods?
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Answer
To see whether adjustments persistently inflate reported performance.
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Question
If a company excludes stock-based compensation from adjusted earnings, what should an analyst ask first?
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Answer
Whether it is truly non-recurring or a normal compensation cost.
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Question
Why is excluding restructuring charges every year a reporting-quality warning sign?
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Answer
A recurring exclusion suggests an ordinary business cost, not one-time.
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