When Edward's five-clawed dragon came up, Jiang Feng and Xiao Hui's mandarin duck bath had just finished. Jiang Feng in the bathroom once again experienced the extremely charming charm of this girl Xiao Hui.

Edward came up and saw Xiao Hui with a pure and charming face, and had already come up. After a moment of being stunned, he guessed that the two of them had probably lived here last night. Edward was not unfamiliar with Xiao Hui. He knew that this oriental girl was one of the closest people to the boss.

The two of them did not avoid Xiao Hui when they talked. Xiao Hui also enjoyed this taste, and just snuggled intimately beside Jiang Feng, like a gentle little wild cat.

Edward introduced the general situation of General Motors. It was similar to what Jiang Feng imagined. The main reason why General Motors could not operate was the extreme lack of liquidity, and the automotive industry was an industry that needed strong capital to support. After all, the R&D of automobiles was very expensive. Now General Motors only talked about tens of millions of dollars in cash, which could not support such a big athletic as General Motors. It was difficult to cope with monthly regular expenses alone, and many assets that were easy to cash had long been mortgaged to the bank. It can be said that except for the Morgan consortium behind it, General Motors could no longer hold on.

The Morgan Consortium, the owner of General Motors, has not had enough funds to save their former pride. Faced with a big club like General Motors, it will inevitably bring about a very troublesome negative effect, so it is eager to find a buyer.

Logically speaking, General Motors should not be so decayed quickly. Speaking of which, this has a lot to do with Jiang Feng.

In another time and space, General Motors was delayed until 2009 and finally couldn't hold on and chose to go bankrupt and reorganize, which was directly related to the good benefits of General Motors' branch in China, Mingzhu General Motors. It can be said that it was Mingzhu General Motors' transfusion of blood to General Motors, which allowed General Motors to maintain it.

However, in this time and space, Jiang Feng has strongly inserted into the automobile industry and developed automobile brands of all grades, and its surname can even surpass the same level of automobiles. In addition, the inflated national self-esteem of the Chinese people has greatly affected the benefits of major automobile manufacturers' branches in China. By the end of 2006, Jiang's Automobile's share in China's automobile industry had accounted for 60%, which reduced the profits of major automobile manufacturers in China by about 80%, which can be said to have almost interrupted the backbone of major automobile manufacturers.

Not only that, in the international market, Jiang's Automobile also has a certain market share with its relatively low price and excellent surname capabilities, which further squeezes the profits of major auto manufacturers, including General Motors.

It can be said that not only General Motors, but also in another time and space, Audi, which was prosperous during this period, had also had poor operations. It can even be said that Jiang's influence on Audi exceeded that on General Motors, because Audi's official procurement status in China was replaced by Jiang's Automobile. Although they were also one of the designated cars officially purchased, they were severely suppressed by Jiang's Automobile.

The various influences are combined and reflected in the market value of major automobile manufacturers. For example, the three major automobile companies in the United States, General Motors, Ford and DaimlerChrysler, had a stock market value of only US$88.6 billion by the end of 2006, which is only about 30% of Microsoft.

It can be said that the three major automobile companies in the United States have had great financial problems in the past few years.

From 2002 to 2006, Microsoft (whose fiscal year ended on June 30 each year) achieved a total net profit of US$53 billion, while the net profit of the three major automobile companies was -13.5 billion, which was a huge contrast with Microsoft.

From the perspective of profitability, the gap between the three major automobile companies and Microsoft is even more different. Taking 2004 as an example, although the total net profit of the three major automobile companies that year was US$9.9 billion, 900 million more than Microsoft's US$9 billion, this does not mean that the profitability of the three major automobile companies is higher than that of Microsoft. Because the three major automobile companies invested 17 times that of human resources (number of employees) that year, and the financial resources (total assets) invested 12 times that of Microsoft, but the output (net profit) it created for shareholders was only about 18% more than Microsoft.

In other words, Microsoft's per capita net profit (human resources input-output ratio) is as high as US$158**5, which is 17 times the per capita net profit of the three major automobile companies (US$9312); Microsoft's total return on assets (financial resources input-output ratio) is 9.54%, which is 10 times the return on assets of the three major automobile companies (0.94%).

The profitability gap is breathtaking!

Because the profitability of the three major automobile companies is far less than that of Microsoft, their stock market value is naturally lower than that of Microsoft.

Traditionally, net assets are often used to measure the financial risks of a company. At the end of the past five fiscal years, the net assets of the three major automobile companies were significantly greater than Microsoft. At the end of the fiscal year 2006, the net assets of the three major automobile companies were US$36.2 billion, which is US$5.1 billion more than Microsoft's US$31.1 billion. Can this mean that the financial risks of the three major automobile companies are less than Microsoft? The answer is obviously no.

When measuring the financial risks of a company, the size of net assets is important, but the most important thing is the relative ratio of net assets to total assets (i.e., net assets). Taking 2006 as an example, although Microsoft's net assets were only US$31.1 billion, the total assets supported by this net assets were only US$63.2 billion, with a net asset ratio of 49.2% (i.e., the debt ratio was only 50.8%). Although the three major automobile companies have net assets of US$36.2 billion, their total assets were as high as US$715.6 billion, and their net assets were only 5.1% (the debt ratio was as high as 94.9%).

In fact, the debt ratio of the three major automobile companies remains high (over 90% in the past five years), and financial risks are prominent. Microsoft's debt ratio is relatively low, and its liabilities are mainly deferred income. The balance of deferred income in the fiscal year of 2006 was as high as US$12.6 billion, accounting for about 40% of all liabilities. If this factor is proposed (the profits contained in it exceed US$10 billion), the debt ratio is about 30%, indicating that its financial risks are insignificant.

The significant difference in financial risks is also a reuse reason for the significant difference in the stock market value of the three major automobile companies and Microsoft.

Do enterprises survive on profits? The 1990s was the most brilliant and splendid decade of economic development in developed Western countries, but many enterprises went bankrupt. Experience data shows that in this period, three of every four bankrupt and bankrupt enterprises were profitable, and only one was loss-making. This shows that enterprises did not survive on profits. So, what exactly did enterprises survive? The answer is that enterprises survive on cash flow. As long as cash turnover fails and the capital chain breaks, the enterprises will surely die.

Therefore, when analyzing a company's financial situation, the first thing to pay attention to is the quality of revenue. Because the income obtained by selling goods or providing labor services is the most stable and reliable source of cash flow for the company. By analyzing the quality of revenue, it can be evaluated to create cash flow by relying on the main business with core competitiveness, and then make a basic judgment on whether the company can continue to operate. In addition, combining the company's revenue with industry data can also calculate market share, and market share is one of the most important hard indicators to evaluate whether a company has core competitiveness.

In the past eight years, Microsoft's sales revenue has grown in double-digits every year, and the characteristics of rapid growth are obvious. In contrast, the sales revenue of the three major automobile companies has basically lingered around the level in 1999, fully reflecting the basic characteristics of the mature market.

The growth of Microsoft's sales revenue not only makes the three major automobiles far beyond the reach, but also makes the three major automobile companies sigh in terms of fluctuations. Microsoft's revenue curve shows a steady upward trend, while the revenue curves of the three major automobile companies are fluctuating, indicating that its stable surname creating cash flow and market competitiveness is obviously inferior to Microsoft.

The United States experienced a period of "unreasonable prosperity" in the 1990s when former Federal Reserve Chairman Greenspan called it "an unreasonable prosperity". In March 2000, a high-tech bubble represented by network and telecom concept stocks began to burst, and its negative impact on the macro economy was fully reflected in 2001. Coupled with the impact of the "9/11" terrorist incident that year, the US economy fell into a trough in 2001.

Faced with such an unfavorable macroeconomic environment, Microsoft's sales revenue still increased by 23% and 12% compared with 1999 and 2000, respectively, which shows that Microsoft has a strong ability to resist macroeconomic cycle fluctuations. In 2001, when the three major automobile companies encountered adversity, their sales revenue quickly fell (the sales revenue of General Motors, Ford and Dykes decreased by 3%, 5% and 4% compared with 2000, respectively), indicating that the three major automobiles have a relatively fragile ability to resist macroeconomic risks.

Profit is the main source of value created by an enterprise for its shareholders and one of the most important indicators to measure the operating performance of an enterprise. Like the analysis method of income quality, the analysis of profit quality also focuses on growth surnames and fluctuating surnames. The higher the growth surname, the smaller the fluctuating surname, the better the profit quality, and vice versa.

Dyke's net profit in 2006 fell by 44% compared with 1999, while General Motors and Ford Motor were even more terrible, with huge losses of US$10.6 billion and RMB12.4 billion in 2005 and 2006 respectively. In sharp contrast, Microsoft's net profit in 2006 increased by 50% compared with 1999. (To be continued.
Chapter completed!