Quickly and accurately calculate key investment ratios Written by a leading finance expert, this book offers simple explanations on how to calculate and interpret key financial ratios. This information is essential for the accurate assessment of a company's financial condition and the true value of its shares. This book is packed with many worked examples from actual company reports and readers will also find many online reference sources-including company Web sites and free software offers. Plus, this book features a supporting Web site at www.magicnumbersbook.com. Magic Numbers is essential reading for individual investors and non-financial executives.
Market Capitalization (and Enterprise Value)
Enterprise Value (EV)
Price-Earnings Ratio
Dividend Yield
PEG Factor
Price-Sales Ratio (PSR)
EV/Ebitda
Price/Book Value
PART TWO: INCOME STATEMENT 'MAGIC NUMBERS'
Margins
Interest Cover
Earnings Per Share
Dividend Cover
PART THREE: BALANCE SHEET
Current Ratio and 'Acid Test'
Debtors Days and Creditors Days
Stock Days and Stockturn
Gearing
Price/Cash Ratio
Burn Rate
Return on Capital Employed
Return on Average Equity
Net Tangible Asset Value
Premium/(Discount) to NAV
PART FOUR: CASH FLOW BASED 'MAGIC NUMBERS'
Free Cash Flow
Fixed Asset Spending/Depreciation
Operating Cash Flow/Operating Profit
Price to Free Cash Flow Ratio
PART FIVE: RISK, RETURN AND VOLATILITY 'MAGIC NUMBERS'
Redemption Yield/Risk Free Rate of Return
Internal Rate of Return
Weighted Average Cost of Capital
Discounted Cash Flow
Reinvested ROE
Volatility
Sharpe Ratio
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