Brightstar is a registered trademark of Brightstar Corp.
Ratio analysis involves evaluating the performance and financial health of a company by using data from the current and historical financial statements.
Price-earnings ratios can provide insights into valuation, while debt-coverage ratios can tell investors about potential liquidity risks.
While there are numerous financial ratios, ratio analysis can be categorized into six main groups: Liquidity ratios include current ratio, quick ratio, and working capital ratio.
Examples of solvency ratios include debt-equity ratio, debt-assets ratio, and interest coverage ratio. Profit margin, return on assets, return on equity, return on capital employed, and gross margin ratio are examples of profitability ratios.
Times interest earned ratio and debt-service coverage ratio are two examples of coverage ratios. These are the most commonly used ratios in fundamental analysis. Investors use these ratios to determine what they may receive in earnings from their investments and to predict what the trend of a stock will be in the future.
The former may trend upwards in the future, while the latter will trend downwards until it matches with its intrinsic value. Successful companies generally have solid ratios in all areas, and any hints of weakness in one area may spark a significant sell-off in the stock.
Certain ratios are closely scrutinized because of their relevance to a certain sector, as for instance inventory turnover for the retail sector and days sales outstanding DSOs for technology companies.
Of course, using any ratio in any of the categories listed above should only be considered as a starting point. Ratios are usually only comparable across companies in the same sector, since an acceptable ratio in one industry may be regarded as too high in another.
For example, companies in sectors such as utilities typically have a high debt-equity ratio, but a similar ratio for a technology company may be regarded as unsustainably high.Watchlist.
S&P Companies by Weight. The S&P component weights are listed from largest to smallest. Data for each company in the list is updated after each trading day. The Nasdaq Stock Market website features stock market news, stock information & quote updates, data analysis reports, as well as a general overview of the market landscape. Financial reporting quality relates to the accuracy with which Apple Inc.'s reported financial statements reflect its operating performance and to their usefulness for forecasting future cash flows. Aggregate accruals deriving measures of the accrual component of Apple Inc.'s earnings.
Sign up to StockTwits to save a watchlist for easy access to your favorite stocks. Apple Computer, Inc. designs, manufactures, and markets personal computers, software, networking solutions, and peripherals, including a line of portable digital music players.
Discover the lessons you can learn from Steve Jobs, with a brief history of Apple.
Discover the innovative world of Apple and shop everything iPhone, iPad, Apple Watch, Mac, and Apple TV, plus explore accessories, entertainment, and expert device support.
Get the latest news and analysis in the stock market today, including national and world stock market news, business news, financial news and more.
Connecting decision makers to a dynamic network of information, people and ideas, Bloomberg quickly and accurately delivers business and financial information, news and insight around the world.