

Ratio Analysis: Introduction
Fundamental analysis has a very broad scope. One aspect looks at the general (qualitative) factors of a company. The other side considers tangible and measurable factors (quantitative). This means crunching and analyzing numbers from the financial statements. If used in conjunction with other methods, quantitative analysis can produce excellent results.
Ratio analysis isn't just comparing different numbers from the balance sheet, income statement and cash flow statement. It's comparing the number against previous years, other companies, the industry or even the economy in general. Ratios look at the relationships between individual values and relate them to how a company has performed in the past, and how it might perform in the future.
For example, current assets alone don't tell us a whole lot, but when we divide them by current liabilities we are able to determine whether the company has enough money to cover shortterm debts.
In this tutorial, we'll show you how to use ratio analysis to analyze financial reports. Comparing these ratios against numbers from previous years, other companies, industry averages and the economy in general can tell you a lot about where a company might be headed. Valuing a company is no easy task. This tutorial will shed some light on how it can be done and, ultimately, help you to make more informed choices as an investor.
Ratio Analysis: Finding The Data



Current Ratio
The current ratio is a liquidity ratio measuring a company's ... 
Accounting Ratio
A way of expressing the relationship between one accounting result ... 
Cash Ratio
The ratio of a company's total cash and cash equivalents to its ... 
Financial Statement Analysis
The process of reviewing and evaluating a company's financial ... 
Combined Ratio
A measure of profitability used by an insurance company to indicate ... 
Debt Ratio
A financial ratio that measures the extent of a company’s or ...

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Learn what information is important in fundamental analysis of a publicly traded company and how to use it to assess the ... Read Answer >> 
What role does ratio analysis play in valuing a company?
Learn about the role of ratio analysis in determining company value, including some of the most common ratios used by modern ... Read Answer >> 
Why do shareholders need financial statements?
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How do I take qualitative factors into consideration when using fundamental analysis?
Fundamental analysis is the method of analyzing companies based on factors that affect their intrinsic value. There are two ... Read Answer >> 
How does ratio analysis make it easier to compare different companies?
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Learn about how fundamental analysis ratios can be combined with quantitative stock screening methods and how technical indicators ... Read Answer >>