Fixed assets turnover is a financial ratio that evaluates how efficiently a company utilizes its fixed assets, such as property, plant, and equipment, to generate sales. This ratio is calculated by dividing net sales by average fixed assets, offering insight into a company’s ability to maximize the use of its long-term investments in core operations.
Average collection period is a financial metric that measures how long it takes for a company to collect payments from its customers. when a company sells products or services to its customers, it often allows them to pay later, on credit. The average collection period is the average number of days it takes for the company to collect these payments from its customers.
Total assets turnover is a financial metric that assesses how efficiently a company uses its assets to generate sales revenue. Calculated by dividing net sales by average total assets, this ratio provides insights into the effectiveness of asset utilization in driving business performance.
Gross profit margin is a key financial metric that measures the percentage of revenue remaining after deducting the cost of goods sold (COGS). It reflects how efficiently a company produces and sells its products by indicating the portion of sales revenue available to cover operating expenses, taxes, and profit.
The net profit margin is a key profitability metric that indicates how much of a company's revenue is converted into net profit after all expenses, including taxes and interest, are deducted. This ratio provides insight into the overall efficiency of a company's operations and its ability to manage costs relative to its revenue.
Return on Equity (ROE) is a crucial financial metric that provides valuable insights into a company's financial position and performance. It indicates how efficiently a company generates profits from shareholders' investments. It shows how much net income is produced for each dollar of shareholders' equity.
Return on Capital Employed (ROCE) is a valuable financial metric that provides important insights into a company's financial position and operational efficiency. It indicates how efficiently a company utilizes its capital to generate profits. It shows how much operating income is generated for each dollar of capital invested.
Return on Assets (ROA) is a valuable financial metric that provides important insights into a company's financial position and operational efficiency. It indicates how efficiently a company utilizes its assets to generate profits. A higher ROA suggests that the company is more effective at converting its investments into net income.
The quick ratio, also known as the acid-test ratio, is a financial metric that evaluates a company's ability to meet short-term liabilities with its most liquid assets, excluding inventory. This ratio provides a more stringent measure of liquidity than the current ratio, as it focuses only on assets that can be quickly converted to cash, like cash equivalents, marketable securities, and receivables.
The current ratio is a key liquidity metric that evaluates a company's ability to meet its short-term liabilities with its current assets. By comparing current assets to current liabilities, this ratio provides insight into the financial stability and operational efficiency of a business. A higher current ratio indicates stronger liquidity, suggesting that the company can easily cover its short-term obligations.
The cash ratio is a financial metric that assesses a company's liquidity by measuring its ability to cover short-term liabilities using only its cash and cash equivalents. It provides a conservative view of a company's financial health, indicating how well-positioned it is to meet immediate obligations without relying on other current assets like receivables or inventory.
The Interest Coverage Ratio is a key financial metric used to evaluate a company's ability to meet its interest payment obligations on outstanding debt. By comparing earnings before interest and taxes (EBIT) to interest expenses, this ratio provides insight into the company's financial health and its capacity to manage debt effectively.