Financial Performance Ratio Analysis
Financial Performance Ratio Analysis is the process of evaluating a company's financial performance by analyzing various ratios calculated from its financial statements. These ratios provide insights into the company's profitability, liquidity, efficiency, and solvency. Key ratios include profitability ratios (such as net profit margin and return on equity), liquidity ratios (such as current ratio and quick ratio), efficiency ratios (such as inventory turnover and accounts receivable turnover), and solvency ratios (such as debt-to-equity ratio and interest coverage ratio). Financial Performance Ratio Analysis helps investors, creditors, and management assess the financial health and performance of a company.