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Business Tutorial: Ratios

Types of Ratios

Profitability

  • Gross Margin
  • Net Profit Margin
  • Operating Margin
  • Pretax Margin

Valuation (P=Price, E=Earnings)

  • P/E (excluding extraordinary items)
  • P/E (normalized)
  • P/Sales
  • P/Tangible book
  • P/ Cash flow

Per Share Data 

  • EPS (excluding extraordinary items) 
  • EPS (normalized)
  • Revenue per share
  • Cash per share
  • Cash flow per share

Financial Strength or Solvency

  • Current Ratio
  • Quick Ratio
  • Long-Term(LT) Debt/Equity
  • Total Debt/Equity
  • Payout Ratio

Management Effectiveness

  • Return on Assets
  • Return on Equity
  • Return on Investments

Growth

  • Earnings per share (EPS)
  • Dividend Growth

Assistant Head, Information Services

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Kathleen Berger
Contact:
bergerkm@bu.edu
Room 318E
Pardee Library
617-353-4312