Profitability ratios can help investors and analysts compare the financial efficiency of competing companies. People are often advised to do “the best they can with what they have,” and the same goes ...

Whether you’re a seasoned investor, or just starting out, one question that will probably be on your mind is whether an individual stock is cheap or expensive – a fact that can be revealed by its ...

When it comes to income investing, it’s good to know the dividend payout ratio formula. It can give you insight into dividend safety. When it comes to dividend stocks, this ratio is always on my ...

Liquidity ratios are key financial ratios used by internal and external analysts to gauge a company's liquidity, which represents its capacity to pay its existing short-term liabilities if it needs to ...

Everyone wants to generate a healthy return on their investments. As the saying goes, you should “buy low and sell high.” But while you may think it’s a good idea to invest in a downward-trending ...

What is the price-to-earnings ratio? The price-to-earnings ratio, commonly known as the P/E ratio, is a stock valuation measure. It can help you assess a company's current share price relative to its ...

The current ratio is calculated by dividing a company’s current assets by its current liabilities. Ratios of 1 or higher indicate short-term solvency.

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 ...

Learn how the reserves-to-production ratio estimates the lifespan of natural resources. Discover its role in predicting ...

The lower the DTI for a mortgage the better. Most lenders see DTI ratios of 36 percent or less as ideal. It is very hard to get a loan with a DTI ratio exceeding 50 percent, though exceptions can be ...