Formulas
Financial ratios are valuable tools for investors: they make it possible to assess financial results and trends across time periods. They also offer key benchmarks for evaluating how effective an organization is, helping to identify companies that outperform their industry peers. Managers can use financial ratios to pinpoint their business's strengths and weaknesses and build effective strategies and initiatives. These ratios are widely used in financial analysis to gauge a company's internal performance and its relative standing. Grouped into profitability, liquidity, solvency and valuation measures, they provide insights that help investors make sound stock selections and avoid substantial losses.
Here is the list of all the financial ratios we use to calculate the key metrics and ratios in our API. The calculation period matches the period of the financial statements.
| Ratio | Formula |
|---|---|
| Current Ratio | CurrentAssetsCurrentLiabilities |
| Price-to-Earnings ratio (P/E) | price(netIncome / shareNumber) |
| Price to Sales Ratio | price(revenue / shareNumber) |
| Price-to-Cash Flow ratio (P/CF) | price(operatingCashFlow / shareNumber) |
| Price to Free Cash Flow Ratio (PFCF) | marketCapfreeCashFlow |
| Price-to-Book (PB) Ratio | price(totalStockHolderEquity / shareNumber) |
| Sales Ratio to Enterprise value-to-sales | enterpriseValuerevenue |
| Enterprise Value | marketCap - cashAndCashEquivalents + totalDebt |
| Enterprise Value Over EBITDA | enterpriseValueebitda |
| Enterprise Value To Operating Cash Flow | enterpriseValueoperatingCashFlow |
| Earnings Yield | (netIncome / shareNumber)price |
| Free Cash Flow Yield | freeCashFlowmarketCap |
| Debt To Assets | Long Term DebttotalAssets |
| Net Debt To EBITDA | (totalDebt - cashAndCashEquivalents)ebitda |
| Interest Coverage | ebitinterestExpense |
| Income Quality | operatingCashFlownetIncome |
| Dividend Yield | (dividendPaid / shareNumber)price |
| Payout Ratio | dividendPaidnetIncome |
| Sales General and Administrative To Revenue | salesAndAdminrevenue |
| Return On Tangible Assets | netIncome(totalAssets - inntangibleAsset) |
| Working Capital | totalCurrentAssets - totalCurrentLiabilities |
| Tangible Asset Value | totalAssets - inntangibleAsset - totalLiabilities |
| Net Current Asset Value | totalCurrentAssets - totalLiabilities |
| Average Receivables | (accountsReceivables + lastReceivable)2 |
| Receivables Turnover | revenueaccountsReceivables |
| Revenue Per Share | revenueshareNumber |
| Interest Debt Per Share | (debt + shortTermDebt + interestExpense)shareNumber |
| Return on Equity (ROE) | netIncometotalStockHolderEquity |
| Capex Per Share | capexshareNumber |
| Quick Ratio | (cashAndCashEquivalents + shortTermInvestments + accountsReceivables)totalCurrentLiabilities |
| Cash Ratio | cashAndCashEquivalentstotalCurrentLiabilities |
| Gross Profit Margin | grossProfitrevenue |
| Return on Assets | netIncometotalAssets |
| Return on Capital Employed | operatingProfit((averageTotalAssets − averageCurrentLiabilities) / 2) |
| Company Equity Multiplier | totalAssetstotalStockHolderEquity |
| Net Income Per EBT | netIncomeincomeBeforeTaxes |
| Long Term Debt to Capitalization | debt(debt + totalStockHolderEquity) |
| Total Debt to Capitalization | (debt + shortTermDebt)(shortTermDebt + debt + totalStockHolderEquity) |
| Fixed Asset Turnover | revenuenetPPE |
| Operating Cash Flow Sales Ratio | operatingCashFlowrevenue |
| Free Cash Flow Operating Cash Flow Ratio | freeCashFlowoperatingCashFlow |
| Cash Flow Coverage Ratios | operatingCashFlow(shortTermDebt + debt) |
| Short Term Coverage Ratios | operatingCashFlowshortTermDebt |
| Capital Expenditure Coverage Ratio | operatingCashFlowcapex |
| Dividend Paid and Capex Coverage Ratio | operatingCashFlow(capex + dividendPaid) |
| Days of Sales Outstanding | (AccountReceivable(start)+AccountReceivable(end))/2revenue/365 |
| Days of Inventory Outstanding | (Inventories(start)+Inventories(end))/2COGS/365 |
| Operating Cycle | Days of Sales Outstanding + Days of Inventory Outstanding |
| Days of Payables Outstanding | (AccountsPayable(start)+AccountsPayable(end))/2COGS/365 |
| Cash Conversion Cycle | Days of Sales Outstanding + Days of Inventory Outstanding + Days of Payables Outstanding |
| Operating Profit Margin | OperatingIncomerevenue |
| Pretax Profit Margin | IncomeBeforeTaxrevenue |
| Net Profit Margin | NetIncomerevenue |
| Effective Tax Rate | ProvisionForIncomeTaxesIncomeBeforeTax |
| NIperEBT | NetIncomeEBT |
| EBTperEBIT | EBTEBIT |
| EBITperRevenue | EBITrevenue |
| Debt Ratio | totalLiabilitiestotalAssets |
| Debt Equity Ratio | totalLiabilitiestotalStockHolderEquity |
| Cash Flow to Debt Ratio | OperatingCashFlowsTotalDebt |
| Asset Turnover | revenuetotalAssets |
| Price Earnings to Growth Ratio | PriceEarningsRatioEPSGrowth |
| Enterprise Value Multiplier | EnterpriseValueEBITDA |
| Price Fair Value | priceIntrinsicValue |
| Return on Invested Capital | operatingProfit×(1−taxRate)(totalEquity + totalNonCurrentLiability + shortTermDebt + capitalLeaseObligationsCurrent) |
| Beta | Monthly price change of stock relative to the monthly price change of the S&P500 (The time period for Beta is 5 years (60 months) when available) |