Financial ratios are an indicator of health for any business. They may seem esoteric, but to lenders and investors they tell the true story of a company's financial strength and ability to weather an ...

Among the important tools available to investors is ratio analysis. For example, we commonly, perhaps even unconsciously, use the price-earnings ratio as a way of evaluating a stock's price and ...

The price-earnings ratio is the second major valuation ratio profiled in Axel Tracy's book, Ratio Analysis Fundamentals: How 17 Financial Ratios Can Allow You to Analyse Any Business on the Planet.

Ratio analysis assesses company performance using financial ratios. ITW improved profit margins and FCF through strategic alignment. ITW's stock outperformed S&P 500 over a decade, showing strategic ...

How well can current assets cover current liabilities? Reviewed by Amy Drury The acid-test ratio (ATR), also commonly known as the quick ratio, measures the liquidity of a company by calculating how ...

Ratio analysis is one of the cornerstones of the financial used by investors and companies alike to judge the effectiveness of business. There are dozens of ratios used to examine profitability, ...

P/E ratio compares stock price to earnings, signaling if a stock is valued fairly. Use P/E to compare similar companies, aiding in spotting overpriced or underpriced stocks. Check other financial ...

James Chen, CMT is an expert trader, investment adviser, and global market strategist. Gordon Scott has been an active investor and technical analyst or 20+ years. He is a Chartered Market Technician ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Michael Boyle is an experienced financial ...