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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
Equity Multiplier

Equity Multiplier

What is Equity Multiplier (EM)?Equity Multiplier is a key financial metric that measures the level of debt financing in a business. In other words,… Read Article
Defensive Interval Ratio

Defensive Interval Ratio

Defensive Interval Ratio (DIR): MeaningA defensive interval ratio (DIR) is a very useful liquidity ratio for measuring a company’s liquidity position. It measures a… Read Article
Liquidity Ratios

Liquidity Ratios

What are Liquidity Ratios?Liquidity ratios give an idea about a company’s ability to convert its assets into cash and pay its current liabilities with… Read Article
Capital Gearing Ratio

Capital Gearing Ratio

For understanding the meaning of the capital gearing ratio, we need to first understand the meaning of capital gearing. So, let us see what… Read Article
Operating Margin Ratio

Operating Margin Ratio

What is the Operating Margin Ratio?The operating margin ratio is the ratio of operating income to the revenue of the business. It highlights the… Read Article
Enterprise Value

Enterprise Value

What is Enterprise Value?Enterprise Value (EV) is the measure of the company’s total value. Instead of determining a firm’s value based on market capitalization… Read Article
Working capital Turnover

Working Capital Turnover Ratio

Meaning of Working Capital TurnoverWorking capital turnover measures the revenue generated from every investment made in the form of working capital. The working capital… Read Article

P/E Ratio

P/E Ratio MeaningThe price-earnings ratio, often called the P/E ratio is a market value ratio of a company’s stock price to the company’s earnings… Read Article
Capital Employed

Capital Employed

Capital Employed is the total amount of investment made for running the business. It should not be confused with the term “capital.” Capital represents… Read Article
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