Finance Ratios

Assets

= Liabilities + equity

Income

= Revenue - expenses

cash flow from assets (identity)

= cash flow to creditors + cash flow to stockholders

current ratio

= current assets ÷ current liabilities

quick ratio

= (current assets - inventory) ÷ current liabilities

cash ratio

= cash ÷ current liabilities

NWC to total assets

= NWC ÷ total assets

interval measure

= current assets ÷ average daily operating costs

total debt ratio

= (total assets - total equity) ÷ total assets

debt-equity ratio

= total debt ÷ total equity OR Equity multiplier - 1

equity multiplier

= total assets ÷ total equity

long-term debt ratio

= long-term debt ÷ (long-term debt + total equity)

times interest earned ratio

= EBIT ÷ interest

cash coverage ratio

= (EBIT + depreciation) ÷ interest

inventory turnover

= COGS ÷ inventory

Payables turnover

= COGS ÷ accounts payable

days in sales inventory

= 365 ÷ inventory turnover

Receivables turnover

= sales ÷ accounts receivable

NWC turnover

Sales ÷ NWC

Fixed asset turnover

= sales ÷ net fixed assets

total asset turnover

= sales ÷ total assets

ROE

= Net income ÷ total equity OR Profit margin x total asset turnover x equity multiplier

ROA

= Net income ÷ total assets

Profit margin

= Net income ÷ sales

Price-earnings ratio

= price per share ÷ earnings per share

PEG ratio

= price-earnings ratio ÷ earnings growth rate %

price-sales ratio

= Price per share ÷ sales per share

market-to-book ratio

= market value per share ÷ book value per share

Tobin’s Q ratio

= market value of assets ÷replacement cost of assets

enterprise value EBITDA ratio

= enteprise value ÷ EBITDA

NWC

Assets - liabilities