Stock Analysis Ratios
September 1, 2010
Stock analysis across multiple stocks is much simpler if you take advantage of the insight you can glean from a collection of stock market ratios such as earnings per share, price earnings, dividend yield, and debt to asset ratio.Ã‚Â The performance and market conditions for each company behind shares of stock you’re comparing will vary, making it harder to evaluate the companies all on the same criteria.
That’s where financial ratios come into the picture; they can help you understand where companies stand relative to one another in terms of cash flow, debt, earnings, and other important financial metrics. Once you understand what these ratios represent, you can setup stock screens on the various ratios to help you find stocks of companies that meet the specific criteria that are important to your investing strategy.Ã‚Â Most online brokers allow you to setup stock screens to help monitor these ratios.
A while back we ran a series of posts covering some of the most widely used stock analysis ratios, below are links to each of the articles.Ã‚Â Each one describes what the financial ratios represent and how you can use them to analyze a stock.
- Earnings Per Share & Price to Earnings Ratio
- Price to Earnings Growth, Debt to Asset Ratio, & Dividend Yield
- Price to Book Ratio, Beta, & Price to Sales Ratio
All posts by Ben Edwards