# Introduction to Financial Ratio Analysis

Introduction to Financial Ratio Analysis

GETTING STARTED

Introduction to Financial Ratio Analysis Ratio analysis is a tool to help evaluate the overall financial condition of a customer's business. Ratios are useful for making comparisons between a customer and other businesses in an industry. A financial ratio is a simple mathematical comparison of two or more entries from a company's financial statements.

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What you'll learn

• Calculate and interpret various financial multiples
• Learn how to evaluate a company using ratio analysis
• Interpret ratios used in credit & equity analysis
• Ratio analysis & forecasting
• Requirements
• No prior experience is required. We will start from the very basics.

Description

Are you in for some financial ratio analysis?

Have you ever wondered what the ROE, P/E, EPS, ROA, GPM abbreviations mean and how to interpret them?

You have come to the right place!

/Among all the benefits of the course, its integrity is what makes it so comprehensive and easily digestible. It will help you understand how ratio analysis works in practice.

We will train you to recognize whether a company:

1. - Is generating sufficient profits to cover its expenses
2. - Is heavily in debt and headed to insolvency
3. - Has some liquidity issues and significant cash shortages
4. - Is under- or overvalued

In fact, this is essential for those of you who have taken on a career in Finance, such as:

• Finance Manager
• Financial Analyst
• Equity Analyst
• Investor, or

Someone who is just keen to enhance their financial literacy and skills.

We will tackle several categories of financial multiples with practical examples and challenges aiming to reinforce what you have learned. The course is beautifully animated, easy to follow, and interactive. Our goal is to deliver the ultimate training experience for you!

The financial ratios that we will cover fall into the following categories:

Activity ratios

• Inventory turnover
• Liquidity ratios
• Current ratio
• Cash ratio
• Quick ratio
• Solvency ratios
• Debt-to-assets
• Debt-to-capital
• Debt-to-equity
• Financial Leverage
• Profitability ratios
• Gross profit margin
• Operating profit margin
• Net profit margin
• Return on assets (ROA)
• Return on equity (ROE)
• Valuation ratios
• Earnings per share (EPS)
• Price/earnings ratio (P/E)
• Dividend yield

In addition, we will examine a key technique called the DuPont Analysis.

It compiles a number of ratios into a comprehensive financial analysis framework. This is а definite must-know for everyone interested in becoming a seasoned professional in the field.

And that’s not all!

By the end of the course, you will also get the chance to compute some financial ratios employed in equity and credit analysis, as well as learn what segment reporting is.

Finally, we will illustrate how ratio analysis can be used to model and forecast earnings. Sounds exciting, doesn’t it?

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