Performance Ratios Flashcards
1
Q
Gross profit margin
A
gross profit/sales
2
Q
Operating margin
A
EBITDA/Sales
3
Q
EBIT margin
A
EBIT/Sales
4
Q
Net profit margin
A
Net income/sales
5
Q
Return on assets (ROA)
A
Net income/Total assets
6
Q
Return on equity (ROE)
A
Net income/Shareholder’s equity
7
Q
Earning per share (EPS)
A
(Net income - Dividends on preferred shares)/Weighted average number of outstanding common shares
8
Q
Diluted earnings per share
A
(Net income - Dividends on preferred shares)/(Weighted average number of outstanding common shares+number of potential common shares)
9
Q
Price-to-earning ratios
A
Share price/EPS
