Last Twelve Months - LTM

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DEFINITION of 'Last Twelve Months - LTM'

A period of time commonly used to evaluate financial results such as a company's performance or investment returns. Twelve months is a relatively short time frame, but it is a period long enough to generate a meaningful set of data.

Also called trailing twelve months (TTM). This term is often found in a company's financial statements.

BREAKING DOWN 'Last Twelve Months - LTM'

A twelve-month period can provide a useful set of data for a number of reasons. For example, when evaluating the earnings of a retail company, data from one quarter would not provide an accurate picture of performance since retail companies do most of their business around the winter holidays. When evaluating an investment, a twelve-month period is sometimes long enough to smooth out the effects of short-term swings in the market, and give an idea of the investment's potential future direction.

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RELATED FAQS
  1. Why would you use the TTM (trailing twelve months) rather than the data from the ...

    Public companies report their yearly financial statements along with an annual report. However, financial professionals are ... Read Full Answer >>
  2. What are some examples of general and administrative expenses?

    In accounting, general and administrative expenses represent the necessary costs to maintain a company's daily operations ... Read Full Answer >>
  3. How do dividend distributions affect additional paid in capital?

    Whether a dividend distribution has any effect on additional paid-in capital depends solely on what type of dividend is issued: ... Read Full Answer >>
  4. Why can additional paid in capital never have a negative balance?

    The additional paid-in capital figure on a company's balance sheet can never be negative because companies do not pay investors ... Read Full Answer >>
  5. When does the fixed charge coverage ratio suggest that a company should stop borrowing ...

    Since the fixed charge coverage ratio indicates the number of times a company is capable of making its fixed charge payments ... Read Full Answer >>
  6. How does additional paid in capital affect retained earnings?

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