Debt Ratios
What it tells?
Debt ratios can be used to determine the overall level of financial risk a company has. In general, the greater the amount of debt held by a company the greater the financial risk of bankruptcy.
- Debt Ratio
- Debt-Equity Ratio
- Interest Coverage Ratio
Debt Ratio
The debt ratio compares a company's total debt to its total assets, which is used to gain a general idea as to the amount of leverage being used by a company.A low percentage means that the company is less dependent on leverage, i.e., money borrowed from and/or owed to others.
It is calculated as
Debit Ratio = Total Liabilities / Total Assets
Debt-Equity Ratio
The debt-equity ratio is another leverage ratio that compares a company's total liabilities to its total shareholders' equity.It is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed.
It is calculated as
Debt-Equity Ratio
The debt-equity ratio is another leverage ratio that compares a company's total liabilities to its total shareholders' equity.It is a measurement of how much suppliers, lenders, creditors and obligors have committed to the company versus what the shareholders have committed.
It is calculated as
Debit-Equity Ratio = Total Liabilities / Share holders Equity
Interest Coverage Ratio
The interest coverage ratio is used to determine how easily a company can pay interest expenses on outstanding debt.The lower the ratio, the more the company is burdened by debt expense.When a company's interest coverage ratio is only 1.5 or lower, its ability to meet interest expenses may be questionable.
It is calculated as
Interest Coverage Ratio
The interest coverage ratio is used to determine how easily a company can pay interest expenses on outstanding debt.The lower the ratio, the more the company is burdened by debt expense.When a company's interest coverage ratio is only 1.5 or lower, its ability to meet interest expenses may be questionable.
It is calculated as
ICR = EBIT/ Interest Expense
Performance Ratios
What it tells?
The performance ratios do give users an insight into the company's performance and management during the period being measured.
This indicator simply measures the amount of sales, or revenue, generated per employee.
It is calculated as
Performance Ratios
What it tells?
The performance ratios do give users an insight into the company's performance and management during the period being measured.
- Sales/Revenue Per Employee
This indicator simply measures the amount of sales, or revenue, generated per employee.
It is calculated as
Sales per employee = Revenue / Number of employees
Other Ratios
Book Value (BV)
It is calculated as
BV = (Share Capital + Reserves& Surplus) – MISC Expenses / Number of shares
Earnings per Share (EPS)
It is calculated as EPS = PAT / Number of shares
P/E Ratio (Price/ Earnings ratio)
It is calculated as P/E = Market Price / Earnings per Share
Dividend Yield
It is calculated as Dividend Yield =Annual Dividend per share / Stock Price per Share
Other Ratios
Book Value (BV)
It is calculated as
BV = (Share Capital + Reserves& Surplus) – MISC Expenses / Number of shares
Earnings per Share (EPS)
It is calculated as EPS = PAT / Number of shares
P/E Ratio (Price/ Earnings ratio)
It is calculated as P/E = Market Price / Earnings per Share
Dividend Yield
It is calculated as Dividend Yield =Annual Dividend per share / Stock Price per Share
