The price-to-book ratio, or P/B ratio, looks at a company from a different angle. It compares the stock’s market ...

Discover how ratio analysis simplifies comparing company financial health. Learn key ratios like P/E and net profit margin to boost your investment decisions.

Reviewed by Natalya Yashina Fact checked by Suzanne Kvilhaug Analyzing a company's financial ratios is one way of examining a company's balance sheet and income statement. Financial ratios track a ...

Liquidity ratios are key financial ratios used by internal and external analysts to gauge a company's liquidity, which represents its capacity to pay its existing short-term liabilities if it needs to ...

Financial ratios are tools used to assess the relative strength of companies by performing simple calculations on items on income statements, balance sheets and cash flow statements. Ratios measure ...

Efficiency level measures a company’s capability to transform available input into output, and is often considered an essential parameter for gauging its potential to generate profits. A company with ...

Analysts have many ways to determine if a stock’s price is cheap or expensive, relative to its performance. One way to measure this is the price-to-earnings ratio, or P/E ratio. Put simply, the P/E ...

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...

Financial ratios express relationships between financial statement items. Although they provide historical data, management can use ratios to identify internal strengths and weaknesses, and estimate ...