Financial ratios are an indicator of health for any business. They may seem esoteric, but to lenders and investors they tell the true story of a company's financial strength and ability to weather an ...

The quick ratio, often referred to as the acid-test ratio, measures a company's ability to cover its short-term liabilities with its most liquid assets, excluding inventory. It's calculated as (cash + ...

Financial ratios are calculations that compare two (or more) pieces of financial data that are normally found in a company's financial statements. Ratios can be invaluable to investors making ...

Smart investors use financial ratios to analyze a company's financial performance before making an investment. Financial ratios reveal how a company is financed, how it uses its resources, its ability ...

The quick ratio, also known as the acid-test ratio, measures a company's ability to pay off its current debt. Current debt includes any liabilities coming due within a year, like accounts payable and ...

Ratio analysis assesses company performance using financial ratios. ITW improved profit margins and FCF through strategic alignment. ITW's stock outperformed S&P 500 over a decade, showing strategic ...

Liquidity ratios assess if a company can cover short-term debts with available assets. Key ratios include cash, quick, current, and operating cash flow ratios. A liquidity ratio over 1 suggests a ...

When you’re evaluating a potential investment, you likely look at profitability and growth, but there is one fundamental concept you must master first: liquidity. Just as a household needs enough cash ...

Suzanne is a content marketer, writer, and fact-checker. She holds a Bachelor of Science in Finance degree from Bridgewater State University and helps develop content strategies. Ratio analysis helps ...

Kristina Zucchi is an investment analyst and financial writer with 15+ years of experience managing portfolios and conducting equity research. Costco is a wholesale retailer whose main competitors ...

A quick ratio is a metric used to calculate a company's liquidity and how easily it could pay off its debts. A quick ratio works by providing a relatively fast assessment of a company's financial ...