Turners Automotive Group's (NZSE:TRA) Problems Go Beyond Weak Profit

Simply Wall St.06-02

A lackluster earnings announcement from Turners Automotive Group Limited (NZSE:TRA) last week didn't sink the stock price. Our analysis suggests that along with soft profit numbers, investors should ...

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Our analysis suggests that along with soft profit numbers, investors should ...</p>\n\n<a href=\"https://simplywall.st/stocks/nz/retail/nzx-tra/turners-automotive-group-shares/news/turners-automotive-groups-nzsetra-problems-go-beyond-weak-pr\">Source Link</a>\n\n</div>\n","source":"simplywall_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>Turners Automotive Group's (NZSE:TRA) Problems Go Beyond Weak Profit</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nTurners Automotive Group's (NZSE:TRA) Problems Go Beyond Weak Profit\n</h2>\n\n<h4 class=\"meta\">\n\n\n2026-06-02 03:33 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://simplywall.st/stocks/nz/retail/nzx-tra/turners-automotive-group-shares/news/turners-automotive-groups-nzsetra-problems-go-beyond-weak-pr><strong>Simply Wall St.</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>A lackluster earnings announcement from Turners Automotive Group Limited (NZSE:TRA) last week didn't sink the stock price.  Our analysis suggests that along with soft profit numbers, investors should ...</p>\n\n<a href=\"https://simplywall.st/stocks/nz/retail/nzx-tra/turners-automotive-group-shares/news/turners-automotive-groups-nzsetra-problems-go-beyond-weak-pr\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"FCF","symbol_name":"第一联邦金融","start_time":0,"source_url":"https://simplywall.st/stocks/nz/retail/nzx-tra/turners-automotive-group-shares/news/turners-automotive-groups-nzsetra-problems-go-beyond-weak-pr","article_id":"2640998561","we_media_id":null,"thumbnails":["https://images.simplywall.st/asset/industry/9551705-choice1-main-header/1585186890631"],"rights":{"source":"simplywall_highlight","url":"https://simplywall.st/stocks/nz/retail/nzx-tra/turners-automotive-group-shares/news/turners-automotive-groups-nzsetra-problems-go-beyond-weak-pr","rn_cache_url":null,"directOrigin":true},"url":"https://stock-news.laohu8.com/highlight/detail?id=2640998561","pubTimestamp":1780342405,"columns":[],"sourceInfo":{"source_id":"simplywall_highlight","name":"Simply Wall St."},"weMediaInfo":null,"summary":"A lackluster earnings announcement from Turners Automotive Group Limited ( NZSE:TRA ) last week didn't sink the stock...","collect":0,"end_time":0,"defaultTopTitle":"simplywall.st","property":[],"viewcount":null,"language":"en","relate_stocks":{"FCF":"第一联邦金融","BK8067":"汽车零售","BK4211":"区域性银行","TRA.NZ":"Turners Automotive Group Ltd Ordinary Shares"},"translate_title":"特纳汽车集团（新西兰证券交易所股票代码：TRA）的问题不仅仅是利润疲软","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"FCF":1,"TRA.NZ":1.5},"content_text":"A lackluster earnings announcement from Turners Automotive Group Limited (NZSE:TRA) last week didn't sink the stock price.  Our analysis suggests that along with soft profit numbers, investors should be aware of some other underlying weaknesses in the numbers.    Trump has pledged to \"unleash\" American oil and gas and these 15 US stocks have developments that are poised to benefit.NZSE:TRA Earnings and Revenue History June 1st 2026 Advertisement Examining Cashflow Against Turners Automotive Group's Earnings  One key financial ratio used to measure how well a company converts its profit to free cash flow (FCF) is the accrual ratio. The accrual ratio subtracts the FCF from the profit for a given period, and divides the result by the average operating assets of the company over that time.  You could think of the accrual ratio from cashflow as the 'non-FCF profit ratio'.  As a result, a negative accrual ratio is a positive for the company, and a positive accrual ratio is a negative.  While it's not a problem to have a positive accrual ratio, indicating a certain level of non-cash profits, a high accrual ratio is arguably a bad thing, because it indicates paper profits are not matched by cash flow.  That's because some academic studies have suggested that high accruals ratios tend to lead to lower profit or less profit growth.  Turners Automotive Group has an accrual ratio of 0.21 for the year to March 2026.   Unfortunately, that means its free cash flow fell significantly short of its reported profits.    In the last twelve months it actually had negative free cash flow, with an outflow of NZ$117m despite its profit of NZ$38.2m, mentioned above.    We saw that FCF was NZ$1.1m a year ago though, so Turners Automotive Group has at least been able to generate positive FCF in the past.   That might leave you wondering what analysts are forecasting in terms of future profitability.  Luckily, you can click here to see an interactive graph depicting future profitability, based on their estimates.   Our Take On Turners Automotive Group's Profit Performance Turners Automotive Group's accrual ratio for the last twelve months signifies cash conversion is less than ideal, which is a negative when it comes to our view of its earnings.      Because of this, we think that it may be that Turners Automotive Group's statutory profits are better than its underlying earnings power.    Nonetheless, it's still worth noting that its earnings per share have grown at 12% over the last three years.     At the end of the day, it's essential to consider more than just the factors above, if you want to understand the company properly.    So while earnings quality is important, it's equally important to consider the risks facing Turners Automotive Group at this point in time.    Case in point: We've spotted 3 warning signs for Turners Automotive Group you should be mindful of and 2 of these bad boys make us uncomfortable.    Today we've zoomed in on a single data point to better understand the nature of Turners Automotive Group's profit.   But there is always more to discover if you are capable of focussing your mind on minutiae.  Some people consider a high return on equity to be a good sign of a quality business.  So you may wish to see this free  collection of companies boasting high return on equity, or  this list of stocks with high insider ownership. Valuation is complex, but we're here to simplify it.Discover if Turners Automotive Group might be undervalued or overvalued with our detailed analysis, featuring fair value estimates, potential risks, dividends, insider trades, and its financial condition.Access Free AnalysisHave feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.","kind":"highlight","is_publish_news":true,"is_publish_highlight":false,"is_publish_live":false,"is_publish_wemedia":null,"editions":null,"column":"","sentiment":"-1","news_tag":"","news_rank":0,"isVideo":false,"video":null,"symbols":[],"gpt_button":0,"need_auth":false,"need_login_tip":false,"code":"91000000","status":"200"},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"tenantId":"TBGLOBAL","deviceId":"web-server-community-laohu8-v3","version":"4.43.1","shortVersion":"4.43.1","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2640998561","isCrawlerRequest":true}