1. Ratio Analysis: Introduction
  2. Ratio Analysis: Finding The Data
  3. Ratio Analysis: Using Financial Ratios

There is a lot to be said for valuing a company, it is no easy task. If you have yet to discover this goldmine, the satisfaction one gets from tearing apart a companies financial statements and analyzing it on a whole different level is great - especially if you make or save yourself money for your efforts.

In this section we will try to present 19 basic fundamental analysis ratios to help you get started. The ratios are presented in a simplified manner to make them easier to understand. Sure some of the ratios have different varieties, but by the end you will understand the basic premise and reasons for fundamental analysis.

The Ratios:

Performance Activity
Book Value Per Common Share Asset Turnover
Cash Return On Assets Average Collection Period
Vertical Analysis Inventory Turnover
Dividend Payout Ratio Financing
Earnings Per Share Debt Ratio
Gross Profit Margin Debt / Equity Ratio
Price/Earnings Ratio Liquidity Warnings
Profit Margin Acid-Test Ratio
Return on Assets Interest Coverage
Return on Equity Working Capital

Related Articles
  1. Investing

    Analyze Investments Quickly With Ratios

    Make informed decisions about your investments with these easy equations.
  2. Investing

    Ratio Analysis

    Ratio analysis is the use of quantitative analysis of financial information in a company’s financial statements. The analysis is done by comparing line items in a company’s financial ...
  3. Investing

    Financial Ratios to Spot Companies Headed for Bankruptcy

    Obtain information about specific financial ratios investors should monitor to get early warnings about companies potentially headed for bankruptcy.
  4. Investing

    6 Basic Financial Ratios And What They Reveal

    These formulas can help you pick better stocks for your portfolio once you learn how to use them.
  5. Investing

    Biggest Real Estate Operations Sector Movers for July 3, 2012

    The market is on the rise this morning. The Nasdaq has climbed 0.7%; the S&P 500 has increased 0.7%; and the Dow is trading up 0.6%. Underperforming the market overall, the Real Estate Operations ...
  6. Investing

    Analyze Investments Quickly With Ratios

    There are four categories of financial ratios: profitability, liquidity, solvency and valuation.
  7. Investing

    Efficiency Ratio

    There are many types of efficiency ratios, but all measure how well a company utilizes its resources to make a profit. Business managers use these ratios to determine how well they are operating ...
  8. Investing

    Key Financial Ratios for Retail Companies

    Using the following liquidity, profitability and debt ratios, an investor can gather deeper knowledge of a retail company's short-term and long-term outlook.
  9. Investing

    4 Investment Ratios That Can Help You Make Money

    You can learn a lot about an investment’s possibilities by reading the corporation’s financial statements. But it also helps to be familiar with some basic investing ratios.
  10. Investing

    5 Basic Financial Ratios And What They Reveal

    Understanding financial ratios can help investors pick strong stocks and build wealth. Here are five to know.
Frequently Asked Questions
  1. What is the difference between yield and return?

    While both terms are often used to describe the performance of an investment, yield and return are not one and the same ...
  2. What are the Differences Among a Real Estate Agent, a broker and a Realtor?

    Learn how agents, realtors, and brokers are often considered the same, but in reality, these real estate positions have different ...
  3. What is the difference between amortization and depreciation?

    Because very few assets last forever, one of the main principles of accrual accounting requires that an asset's cost be proportionally ...
  4. Which is better, a fixed or variable rate loan?

    A variable interest rate loan is a loan in which the interest rate charged on the outstanding balance varies as market interest ...
Trading Center