FAR 1F - Financial Ratios - Other Flashcards
RoE and Debt Ratio Relationship
RoA = RoE * (1- Debt Ratio)
Equity Multiplier
Assets / Common Equity
Cost of holding A/R (interest)
(Sales/days period) * collection period * required rate of return
OR
Average A/R Balance * Required rate of return
ROE using DuPont Method
Profit Margin * Asset Turnover * Leverage or Equity Multiplier
OR
(Net income - Pref Divi / Net Sales)
*
Net Sales / Average Assets
*
Average Assets / Average Common Equity
ROA
Profit Margin * Asset Turnover
OR
(Net income - Pref Divi / Sales)
*
Sales / Average Assets
Sustainable Equity Growth Rate (SEGR)
RoE * (1-Dividend payout ratio)
Economic Value Add EVA
After-tax operating income - ((total assets - current liabilities) * WACC)
total assets - current liabilities = Invested Capital
Forward P/E Ratio
Today’s Stock price / Future EPS