Ratio Analysis

Tags

finance

Comparison of a companies market share, unsold stock, or other possible assets or non-tangible values with other companies.

A ratio by itself is only useful when looking at the reasons for how/why a ratio changes.

eg. Gross profit margin up 20%, why?

Profit Ratios

Profit ratio measures include:

• Profit Margins
• Return on Capital Employed

Efficiency Ratios

[see page 22, Includes]:

• Inventory holding period
• Trade receivables collection period
• Trade payables payment period

Solvency Ratios

• liquidity-ratio
• Acid Test Ratio

Investment Ratios

See [see page 3, here].