Financial Ratios

(AP)

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Profitability Indicator Ratios

Gross Profit Margin	$\dfrac{Gross Profit}{Revenue}$	0.16	You can think of it as the amount of money from product sales left over after all of the direct costs associated with manufacturing the product have been paid.
Operating Profit Margin	$\dfrac{Operating Income}{Revenue}$	1.00	If companies can make enough money from their operations to support the business, the company is usually considered more stable.
Pretax Profit Margin	$\dfrac{Income Before Tax}{Revenue}$	-0.11	Profit is the main goal of for-profit organizations. The goal is to make a profit through growth and to grow every year. As a result, one of the most important roles of the financial and investment analyst is to track and forecast profitability.
Net Profit Margin	$\dfrac{Net Income}{Revenue}$	-0.17	Generally, a net profit margin in excess of 10% is considered excellent, though it depends on the industry and the structure of the business.
Effective Tax Rate	$\dfrac{Provision For Income Taxes}{Income Before Tax}$	-	If there’s one takeaway, it should be that a company’s tax situation is all but a living, breathing organism in its own right.
Return On Assets	$\dfrac{Net Income}{Average Total Equity}$	-0.28	ROA Return on assets gives an indication of the capital intensity of the company, which will depend on the industry; companies that require large initial investments will generally have lower return on assets. ROAs over 5% are generally considered good.
Return On Equity	$\dfrac{Net Income}{Average Total Assets}$	-0.79	ROE this ratio calculates how much money is made based on the investors' investment in the company.investors want to see a high return on equity ratio because this indicates that the company is using its investors' funds effectively.
Return On Capital Employed	$\dfrac{EBIT}{Average Total Asset − Average Current Liabilities}$	-0.07	ROCE shows investors how many dollars in profits each dollar of capital employed generates.
NIperEBT	$\dfrac{Net Income}{EBT}$	-	NIperEBT.
EBTperEBIT	$\dfrac{EBT}{EBIT}$	-	EBTperEBIT.
EBITperRevenue	$\dfrac{EBIT}{Revenue}$	-0.15	EBITperRevenue.

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