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Ratio Analysis

Ratio analysis is a very important tool in financial analysis. We have covered the complete ratio analysis – its significance, application, importance, and limitations, and all 32 ratios of ratio analysis that are structured and categorized into 6 important heads.

Ratio Analysis
  1. Advantages and Application of Ratio Analysis
  2. Importance of Ratio Analysis
  3. Limitations of Ratio Analysis
Profitability Ratio
  1. Gross Profit Margin
  2. Net Profit Margin
  3. Operating Margin
  4. Expense Ratio
  5. Return on Equity
  6. Return on Assets
  7. Return on Capital Employed
  8. Return on Investment
  9. Return on Net Worth
Turnover Ratios
  1. Fixed Asset Turnover
  2. Asset Turnover
  3. Inventory Turnover
  4. Receivable Turnover
  5. Payable Turnover
  6. Working Capital Turnover
Liquidity Ratios
  1. Current Ratio
  2. Quick Ratio
  3. Defensive Interval Ratio
  4. Cash Ratio
  5. Cash to Income Ratio
Coverage Ratios
  1. Debt Service Coverage Ratio
  2. Interest Service Coverage Ratio
  3. Asset Coverage
  4. Dividend Coverage
  5. Fixed Charge Coverage
  6. Cash Flow Coverage
Solvency Ratio
  1. Leverage Ratios
  2. Debt-Asset Ratio
  3. Debt-Equity Ratio
  4. Gearing Ratio
  5. Equity Multiplier
  6. Cash Flow Adequacy Ratio
Market Value Ratios
  1. Market to Book Ratio
  2. P/E Ratio
  3. Equity Research
Negative P-E Ratio

Negative P/E Ratio

Price-Earnings Ratio (P/E Ratio)Before discussing the Negative P/E Ratio, let’s understand the concept of the Price-Earnings Ratio or P/E ratio. It expresses the relationship… Read Article
Operating Ratios

Operating Ratio

The operating ratio is a type of profitability ratio. It is the comparison of an operating expense to the revenue of a business. Operating… Read Article
Return on Net Worth

Return on Net Worth

Return on Net Worth DefinitionReturn on Net Worth is a profitability ratio developed from the perspective of the investor and not the company. By… Read Article
Leverage Ratios

Leverage Ratios

What are Leverage Ratios?Leverage ratios are financial ratios that measure a company’s financial stability using its capital structure, financial obligations, and its ability to… Read Article
Market Value Ratios

Market Value Ratios

The market value ratios are important for investors, management, etc. These ratios help decide whether the shares are overvalued, undervalued, or at par with… Read Article
Turnover Ratios

Turnover Ratios

The turnover ratios are used to check the company’s efficiency and how it uses its assets to earn revenue. The sales figure is compared… Read Article
Return on Sales

Return on Sales

Return on sales measures the operating profit margin of the company and how the management is working on using the resources. It evaluates whether… Read Article
Cash Flow Coverage Ratio

Cash Flow Coverage Ratio

What is a Cash Flow Coverage Ratio?The cash flow coverage ratio is the ratio of operating cash flow to its debt. It is a coverage… Read Article
ROI

Return on Investment

Return on investment, one of the profitability ratios, is a measure to evaluate the gain on investment. It is a ratio of the ‘profit… Read Article
Market to Book Ratio

Market to Book Ratio

What is Market-to-Book Ratio (M/B)?The market-to-book ratio is simply a comparison of market value with the book value of a given firm. In other… Read Article
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