All Finance terms definitions in the Ratio Analysis category

What is Overhead Ratio ?

Definition of Overhead Ratio Operating costs consist of marketing, office rent, professional fees, utilities, insurance, equipment servicing, devaluation or plants or equipment, etc. Brief Explanation of Overhead Ratio It is a metric that allows organizations to evaluate costs as a percentage of revenue. In common, an organization strives to achieve the lowest operating costs possible […]

What is Net Interest Margin ?

Definition of Net Interest Margin Net Interest Margin is a performance measurement that investigates how effective a company’s financial commitment choices are compared to its debt situations. Brief Explanation of Net Interest Margin A negative value signifies that the company did not make a maximum decision because interest costs were greater than the amount of […]

What is Net Debt to EBITDA Ratio ?

Net Debt to EBITDA Ratio The net debt to EBITDA ratio earnings earlier than interest depreciation and amortization (EBITDA) ratio is an amount of leverage, considered as a company’s interest-bearing liabilities minus money or cash equivalents, divided by its EBITDA. Net Debt to EBITDA Ratio The net debt to EBITDA ratio is a debt ratio that […]

What is Net Debt to Assessed Valuation ?

Definition of Net Debt to Assessed Valuation In a municipal bond problem, a ratio measuring the value of the town’s net debts compared to the specified value of the real estate being purchased as assessed for tax purposes. Net Debt to Assessed Valuation This is one of the factors which determine the high top quality […]

What is Net Debt Per Capita ?

Definition of Net Debt Per Capita A statistic of the value of national debts indicated in terms of the quantity because of each citizen under the national authority. Brief explanation Net Debt Per Capita The level of net debts per domestic is an important aspect to consider when examining a national capability to continue paying […]

What is Net Current Asset Value per Share – NCAVPS ?

Definition of Net Current Asset Value per Share – NCAVPS A value developed by Lecturer Ben Graham in the mid-twentieth millennium to figure out if an organization was trading at a reasonable ratio. Brief Explanation of Net Current Asset Value per Share – NCAVPS NCAVPS is measured by taking an organization’s current assets and […]

What is Current Ratio?

Definition The current ratio is the liquidity ratio which is used to measure the ability of a company to pay its short term obligations. This measure is related to the company’s total assets and total liabilities. If this ratio is high, it means that company has sufficient liquidity to pay its short term liabilities. Explanation […]

What is Debt Ratio?

Definition The debt ratio is a financial ratio that is used to measure the extent of the leverage of the company. It is defined as the ratio of total debts to total assets. It can also be stated as the proportion of assets, financed by the debt of a company. It is also known as […]

What is Debt to Equity Ratio?

Definition It is a debt ratio used to measure the financial leverage of a company, calculated by dividing the total liabilities by stockholder equity of a company. This ratio shows how much debt a company has in order to finance its assets relative to the amount of value represented in stockholder equity. Similarly, it is […]

What is Interest Coverage Ratio?

Definition Interest coverage ratio is used for the determination of company’s capability to repay the interest on outstanding debt. It is also known as profitability ratio and debt ratio. This ratio can be calculated by dividing the earnings before interest and tax of a company with the amount of interest to be paid by the […]

Ratio Analysis