Ratios—one variable divided by another—are financial analysis tools that show how companies are performing in their own right and relative to one another.

Other ratios, such as a debt-to-equity ratio, represent more financial strength if they are lower. Determine the formula for the financial ratio that you want to derive.

When it comes to investing, financial ratios can help you be an informed investor. ... Working Capital Turnover Ratio: Meaning, Formula, and Example. Mutually Exclusive: What It Means, With Examples.

Leverage Ratio Types, Formulas & Examples. ... An example of a high ratio was in 2007, when the consumer leverage ratio was 1.29. A financial crisis and the Great Recession soon followed. 8.

If you're going to become an investor, there are a few things you should know — like these formulas. Read on to learn more.

Here are ten financial ratios that can tell you most of what you need to know when you’re scouring the market for good stocks to buy. ... The formula for ROA is net income divided by total assets.

A coverage ratio helps investors evaluate the financial health of a company and its prospects for paying off the long-term debt it owes. Read on for more details.

Financial matters need to be handled carefully for an organization to perform well. Your organization can use ratio analysis to evaluate its financial status and gauge its performance. Ratio ...

The defensive interval ratio (DIR) is a financial metric that can help investors assess a company's ability to meet its short-term operating expenses using its liquid assets. Also known as the basic ...

Liquidity ratios are key financial ratios used by internal and external analysts to gauge a company's liquidity, ... It's also known as the acid-test ratio. The formula is as follows: ...

The defensive interval ratio (DIR) is a financial metric that can help investors assess a company's ability to meet its short-term operating expenses using its liquid assets. Also known as the ...