The higher the ratio, the better. If the ratio falls to 1.5 or below, it may indicate that a company will have difficulty meeting the interest on its debts. Debt-to-assets ratio Thedebt-to-assets ratiois calculated as follows: Debt-to-Assets Ratio=DebtAssets\text{Debt-to-Assets Ratio}=...
How Is Leverage Ratio Calculated? Each leverage ratio is calculated differently but it often involves dividing a company’s debt by something such as shareholders equity, total capital, or EBITDA. What Is a Good Leverage Ratio? It depends on the particular leverage ratio that's being used as ...
An inventory-to-sales ratio—also known as a stock-to-sales ratio—is a metric that measures the amount of inventory you have compared to the number of orders being fulfilled. When you have just enough inventory to meet sales demands, this is reflected by a lower ratio—that’s what you ...
A higher dividend yield indicates a potentially higher return, but it could also signal risk if the yield is unusually high compared to peers, possibly indicating financial distress or an impending dividend cut. On the other hand, the dividend payout ratio measures the amount of a company’s ...
A loan-to-value (LTV) ratio divides your loan amount by the home’s value; 80% is a good LTV. Lenders use LTV to determine your loan amount, risk, insurance, and interest rate.
Credit utilization ratio is the balance on credit cards compared with available total credit. Use our calculator to check yours and see how it affects your score.
Credit utilization ratio is the balance on credit cards compared with available total credit. Use our calculator to check yours and see how it affects your score.
Financial ratio is the quantitative approach used by the company to analyse the business solvency, liquidity, efficiency, profitability and market value. This evaluation is done on the basis of the information provided in income statement, balance sheet and statement of cash flow. This financial ...
The operating profit margin is calculated by subtracting operating expenses from gross profit, and then dividing by total revenue. Like the gross profit margin, the result is multiplied by 100 to convert it into a percentage. To find the net profit margin, subtract all expenses, including taxes...
The current ratio shows a company’s ability to meet its short-term obligations. The ratio is calculated by dividing current assets by current liabilities. An asset is considered current if it can be converted into cash within a year or less, while current liabilities are obligations expected ...