Profitability Ratios
|
Ratio
|
Formula
|
Gross Profit Margin
|
(Revenue - COGS) / Revenue
|
Net Profit Margin
|
Net Income / Revenue
|
ROA (Return on Assets)
|
Net Income / Total Assets
|
ROE (Return on Equity)
|
Net Income / Shareholder Equity
|
Liquidity Ratios
|
Ratio
|
Formula
|
Current Ratio
|
Current Assets / Current Liabilities
|
Quick Ratio
|
(Current Assets - Inventory) / Current Liabilities
|
Cash Ratio
|
Cash / Current Liabilities
|
Leverage Ratios
|
Ratio
|
Formula
|
Debt-to-Equity
|
Total Debt / Total Equity
|
Debt Ratio
|
Total Debt / Total Assets
|
💡 Pro Tip:
Higher profitability ratios are better, but compare within the same industry!