Financial ratios
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Transcript of Financial ratios
Financial Statement Analysis
FSA
1. Global Macro: Top-down, worldwide investment
analysis
2. Fundamental Analysis: Use of economic and
accounting data to analyze stocks
3. Value Investing: Invest in safe companies that give
good value for the money
4. Ratio Analysis: One of two types of analysis used
for value investing
FSA
FSA
FSA
FSA
1. Income Statement Items.
2. Balance Sheet Items.
3. Common Ratios
FSA
• Liquidity Ratios
• Current Ratio
• Quick Ratio
• NWC to Sales Ratio
FSA
• Profitability Ratios
• Operating Profit Margin
• Net Profit Margin
FSA
• Activity Ratios
• Inventory Turnover
• Total Asset Turn
• Fixed Asset Turn
FSA
• Financial Leverage Ratios
• Total Liabilities to Assets
• Long term Debt to Assets
• Debt to Equity Ratio
• TIE
FSA
• Shareholder Ratios
• EPS
• BV per share
• P/E Ratio
FSA
• Find the Following Information, as well as the yearly growth.
Compare the two companies and choose one to invest in.
• Basic Figures: Revenue, Net Income, Owner’s Equity
• Liquidity Ratios: Current Ratio, Quick Ratio, NWC to Sales Ratio
• Profitability Ratios: Operating Profit Margin, Net Profit Margin
• Activity Ratios: Inventory Turnover, Total Asset Turn, Fixed Asset
Turn
• Financial Leverage Ratio: Total Liabilities to Assets, Long Term
Debt to Assets, Debt to Equity Ratio, TIE
• Shareholder Ratios: EPS, Book Value per Share