Public Company vs Industry Ratio Analysis
PUBLIC COMPANY Vs. INDUSTRY ANALYSIS -
Online since 1996 for student, investor and professional research.
Financial Ratio Analysis Sample Report - One Public Company vs. One Industry
Your financial ratio analysis report is generated while you are on-line:
|5 most recent years of analyzed results, including latest filed quarter, taken directly from the Securities and Exchange Commission (SEC) database|
|Financial Ratio Analysis - 28 of the most useful financial ratios|
|Sustainable Growth Rate prediction|
|Altman Z Score potential for bankruptcy analysis and prediction|
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This company to industry ratio analysis report is broken down into the various ratio categories:
- Predictor Ratios are indicators of the potential for growth or decline.
- Profitability Ratios use margin analysis to indicate the return on sales and capital employed.
- Asset Management Ratios use turnover measures to indicate how efficient a company is operationally and in its use of assets.
- Liquidity Ratios is a snapshot of a company's short term financial health and solvency.
- Debt Management Ratios are indicators of the extent in which debt is used in a company's capital structure.
In evaluating the significance of various industry financial data, analysts engage in financial ratio analysis: the determination and evaluation of financial ratios. A financial ratio is a relationship that indicates an industry's activities, such as the ratio between an industry's current assets and current liabilities or between its accounts receivable and its annual sales. The source for these ratios are the company financial statements within the industry that contain the assets, liabilities, profits, and losses. Industry ratios are only meaningful when compared with other relevant information. Since individual companies are most often compared with industry data, ratios help an analyst to understand a company's performance relative to that of competitors and are often used to trace performance over multiple time frames.
Ratio analysis reveals much about a selected industry. There are several points to keep in mind about ratios: One, financial ratios are "flags" that can indicate areas of strength or weakness. In some cases, one or even several ratios might be misleading, but when combined with other indicators of an industry, ratio analysis provides deeper insight into that industry. Second, there is no one correct value for a ratio. The observation that the value of a particular ratio is too high, too low, or just right depends on the perspective of the analyst. Third, a financial ratio is meaningful only when it is compared with some standard, such as another industry trend, ratio trend, a ratio trend for the specific industry being analyzed..
In trend analysis, industry ratios are compared over time, typically years. Year-to-year comparisons can highlight trends and point up the need for action. Trend analysis works best with five years of ratios.
The second type of ratio analysis (cross-sectional analysis), as in this analysis, compares a company's financial ratios to industry ratio averages. Another popular forms of cross-sectional analysis compares the financial ratios of two or more companies in similar lines of business..