I Bank Prep

Current Ratio

Measure of company’s ability to pay off current liabilities with current assets

Quick Ratio

Measure of firm’s ability to pay off its short-term liabilities with available quick assets

Operating Cash Flow Ratio

Measure of how many times a company pays off its current liabilities with the amount of cash generated in that period

Cash Ratio

ability to pay off its debts with cash, and cash equivalents available

Debt Ratio

Compares company liabilities to its assets, a ratio of less than one is good (less likely to fall into a situatiuon of default payments

Debt to equity ratio

ratio of total liabilites to shareholder’s equity, good if less than one

Interest coverage ratio

ratio of operating income of a company to its new itnerest expenses

operating margin

ratio that determines the operational efficiency of a company, (ratio of operating profit and net sales of company)

return on equity

measures a firm’s efficiency to generate profits with shareholder’s equity

Return on Assets

ratio of net earnings of company and total assets, capability of assets in generating profits

return on capital employed

ratio of operating profit and capital employed (total assets - current liabilities = capital employed)

Return on investment (cash flows)

value of a firm is found through cash flows, ratio of cash flows and market capitalization of firm

asset turnover ratio

value of sales a company can generate by efficiently using its assets

Earnings per share

ratio of net earnings and total outstanding shares(all shares that have been issued and bought), used to find the P/ E ratio

divident payout ratio

percent of net earnings that company distributes

P / E Ratio

ratio of stock price and earnings

divident yield

number of dividents paid to shareholders by a company ompared to its current market price

price to book value

ratio of price to the book value of a company(assets - liabilities is book value)

Price to sales ratio

Ratio of price of stock to firm earnings, considers growth of company

PEG ratio

appreciated version of P / E ratio, by taking into account the growth of firm, has pricing multiple

EBITDA

P / E ratio alternative

revolving credit facility