Financial Statement Analysis

FSA

1. Global Macro: Top-down, worldwide investment

analysis

2. Fundamental Analysis: Use of economic and

accounting data to analyze stocks

3. Value Investing: Invest in safe companies that give

good value for the money

4. Ratio Analysis: One of two types of analysis used

for value investing

FSA

FSA

FSA

FSA

1. Income Statement Items.

2. Balance Sheet Items.

3. Common Ratios

FSA

• Liquidity Ratios

• Current Ratio

• Quick Ratio

• NWC to Sales Ratio

FSA

• Profitability Ratios

• Operating Profit Margin

• Net Profit Margin

FSA

• Activity Ratios

• Inventory Turnover

• Total Asset Turn

• Fixed Asset Turn

FSA

• Financial Leverage Ratios

• Total Liabilities to Assets

• Long term Debt to Assets

• Debt to Equity Ratio

• TIE

FSA

• Shareholder Ratios

• EPS

• BV per share

• P/E Ratio

FSA

• Find the Following Information, as well as the yearly growth.

Compare the two companies and choose one to invest in.

• Basic Figures: Revenue, Net Income, Owner’s Equity

• Liquidity Ratios: Current Ratio, Quick Ratio, NWC to Sales Ratio

• Profitability Ratios: Operating Profit Margin, Net Profit Margin

• Activity Ratios: Inventory Turnover, Total Asset Turn, Fixed Asset

Turn

• Financial Leverage Ratio: Total Liabilities to Assets, Long Term

Debt to Assets, Debt to Equity Ratio, TIE

• Shareholder Ratios: EPS, Book Value per Share