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Ratio Analysis - Profitability
 
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Profitability ratios look at the returns earned by a business both in terms of its trading activities (sales revenue) and also how much is invested in earning those returns (capital employed). This revision video introduces the four main profitability ratios.
Views: 71763 tutor2u
Profitability Ratio Analysis: Financial Ratio Analysis Explained
 
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Profitability Ratio Analysis: Financial Ratio Analysis Explained Support AccoFina's Patreon if you are a Fan or Believer in my work, https://patreon.com/accofina Time Markers: 1) The Profit Margin 1:17 2) The Gross Profit Margin 5:47 3) The Return on Assets 14:28 4) The Return on Equity 21:47 5) Different ways to conduct ratio analysis 27:56 6) Key ideas with all ratio analysis 29:06 1) THE PROFIT MARGIN Tells us how much profit is generated from sales. Percentage of sales revenue that ends up as profit Good indicator of cost control and/or pricing power. Profit Margin Formula: Profit Margin = Net Income / Sales Revenue Example Where do we find the Required Inputs? Net Income: From the Income Statement Sales Revenue: From the Income Statement How to Interpret Changes in the Ratio: Expenses have changed in relation to sales... * Management is effective with cost control * Economies of scale are being utilised. Sales Revenue has changed in relation to expenses... * Change in pricing power (bargaining position with consumers) * Change in state of the economy and aggregate demand 2) THE GROSS PROFIT MARGIN (Very important for resellers and manufacturers) Profit between cost of inventory and sales price. How much sales revenue left to cover profit and all other expenses. Gross Profit Margin Formula: Gross Profit Margin = (Sales Revenue - Cost of Goods Sold) / Sales Revenue Where do we find the Required Inputs? Sales Revenue: From the Income Statement Cost of Goods Sold: From the Income Statement How to Interpret Changes in the Ratio: Sales Revenue has changed in relation to cost of goods sold... * Change in pricing power (bargaining position with consumers) * Change in product or aggregate demand (without a flow through the supply chain yet) * Market competitive position and pressures Cost of Goods Sold has changed in relation to sales revenue... * Power within the supply chain * Change in supplier or production efficiency Changes in prices of particular commodity inputs 3) RETURN ON ASSETS Return generated by the assets for those who funded the assets. Insight into success of management in income generating asset allocation and utilisation. Return on Assets Formula: Return on Assets = (Income beforeTax + Interest Expense) / ((Assets at Start of Period + Assets at End of Period) / 2) Where do we find the Required Inputs? Income before Tax: From the Income Statement Interest Expense: From the Income Statement Assets at Start of Period: From the Previous Balance Sheet Assets at End of Period: From the Current Balance Sheet How to Interpret Changes in the Ratio: Profitability has changed in relation to the level of assets... * Management is getting ‘more from less’ in regards to assets * Management has made good asset allocation decisions in terms of revenue * Management has good control of costs in relation to expenses Previously mentioned reasons: e.g. economy, market power, competitive position Level of assets have changed in relation to profitability... * Assets may have suddenly increased through large, recent * CapEx Assets may not be being replaced or replenished at the same rate * Particular choice of depreciation/amortisation policies 4) RETURN ON EQUITY Return generated for the owners of the business, the common stockholders. Insight into success of any leverage used (when comparing to return on assets). Return on Equity Formula: Return on Equity = (Net Income - Preference Dividends) / ((Common Stockholder Equity at Start of Period + Common Stockholder Equity at End of Period) / 2) Where do we find the Required Inputs? Net Income: From the Income Statement Preference Dividends: From the Income Statement or Investor Relations Equity at Start of Period: From the Previous Balance Sheet Equity at End of Period: From the Current Balance Sheet How to Interpret Changes in the Ratio: Profitability has changed in relation to the level of common stockholder equity... * Management performance is changing in the eyes of, and on behalf of, the owners/employers * Previously mentioned reasons: e.g. economy, market power, competitive position, cost control, asset utilisation Common Stockholder Equity has changed in relation to profitability... * The level of liabilities have changed (and thus equity) * A stock issue or stock buyback (i.e. equity levels have changed) Subscribe to the Channel: https://goo.gl/84Sfeg Or just check out the Channel Page: https://goo.gl/yTj9Bs Most Popular YouTube Video: https://goo.gl/Jbv685 Latest YouTube Upload: https://goo.gl/wDM83Y 1) Website http://www.accofina.com 2) Amazon Author Page: http://www.amazon.com/author/axeltracy 3) Udemy Instructor Page https://www.udemy.com/u/axeltracy/ 4) Twitter http://www.twitter.com/accofina 5) Google+ http://plus.google.com/+accofina 6) Instagram https://www.instagram.com/axel_accofina/ 7) Facebook Page https://www.facebook.com/AccoFina.Page #Accounting #FinancialEducation #FundamentalAnalysis
Views: 51871 AccoFina
Profitability ratio analysis
 
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A brief introduction into three basic profitability ratios: 1. Gross Profit Ratio 2. Net Profit Ratio 3. Rate of Return on Equity Ratio More videos, tasks, quizzes, handouts and other resources can be found at https://meyerflippedlearning.com/#!/home
Views: 14081 Bernd Meyer
Profitability Ratios - Gross, Net, Operating Profit Margin in Hindi (2018)
 
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Profitability ratios - Gross Profit Margin, Net Profit Margin, Operating Profit Margin and Pre Tax Margin explained in hindi. They are also called as Gross Profit ratio, Net Profit ratio and Operating Profit ratio. These return on sales ratios. Similarly, we also have return on investment (ROI) ratios like return on assets (ROA), return on capital employed (ROCE) and Return on Equity (ROE). Related Videos: EBITDA, EBIT & Operating Profit: EBITDA, EBIT & Operating Profit Markup vs Profit Margin: https://youtu.be/ajUUn72pUAk Financial Ratios & Analysis: https://youtu.be/CZscpOND3Vs Return on Investment (ROI): https://youtu.be/ij7y5e2MVG4 Return on Equity (ROE): https://youtu.be/K-OhdUGqdzc ROCE (Return on Capital Employed): https://youtu.be/FjWuma0U2x0 Return on Assets: https://youtu.be/7z9jDKNub6U प्रोफिटेबिलिटी रेश्यो जैसे - ग्रॉस प्रॉफिट मार्जिन, नेट प्रॉफिट मार्जिन, ऑपरेटिंग प्रॉफिट मार्जिन और प्री टैक्स मार्जिन को इस वीडियो में हिंदी में एक्सप्लेन किया गया है। इनको ग्रॉस प्रॉफिट रेश्यो, नेट प्रॉफिट रेश्यो और ऑपरेटिंग प्रॉफिट रेश्यो के नाम से भी जाना जाता है। और रिटर्न ऑन सेल्स रेश्यो की ही तरह रिटर्न ऑन इन्वेस्टमेंट (ROI) रेश्यो जैसे रिटर्न ऑन एसेट्स (ROA), रिटर्न ऑन कैपिटल एम्प्लॉयड (ROCE) और रिटर्न ऑन इक्विटी (ROE) भी होते हैं। Share this Video: https://youtu.be/pHgiuO2ZYoU Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What are the different profitability ratios? What is the gross profit margin? What is the net profit margin? What is the operating profit margin and pre-tax margin? What is the meaning of gross profit ratio, net profit ratio, and operating profit ratio? How to calculate gross profit margin, net profit margin, operating profit margin, and pre-tax margin? How profitability ratio calculation can help you make better investment decisions? How to do profitability ratio analysis of a company? How to calculate the profit margins of any company? What is the formula of gross profit margin calculation? What is the formula of operating profit margin calculation? How to calculate the pre-tax profit margin calculation? How is gross profit margin different from operating profit margin? How profitability ratio calculation helps you to compare companies before investing? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Twitter - http://twitter.com/assetyogi Facebook – https://www.facebook.com/assetyogi Linkedin - http://www.linkedin.com/company/asset-yogi Google Plus – https://plus.google.com/+assetyogi-ay Instagram - http://instagram.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Hope you liked this video in Hindi on “Profitability Ratios - Gross, Net, Operating Profit Margin”.
Views: 19696 Asset Yogi
How to do a Customer Profitability Analysis
 
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You can subscribe to all my Marketing Video Lessons here: http://30minutes.marketing/subscribe This customer profitability analysis video explains why and how to calculate it, and what you should do with the results. Visit My Website: http://30minutes.marketing/ Follow Me On Social Media: Linkedin: https://www.linkedin.com/in/paulocalisto Facebook: https://www.facebook.com/30minutesmar... Twitter: https://twitter.com/30MinutesMarket Customer Profitability Analysis assists business owners, entrepreneurs and marketing experts recognize the earnings coming from each and every customer. The Customer Profitability Analysis, is the net profit or to put it simply the revenue minus all the costs and expenses associated to one individual customer. This assists business owners or marketers in recognizing which customers bring more profit to their business. This understanding it is exceptionally valuable due to the fact that if used correctly will certainly increase the business profitability. At the above video, I will exemplify with a Spa business. Basically in this example a Spa will analyze their customer profitability and divide them into five different groups. When analyzing the data and segment it into five groups, it will come to the conclusion that the best customers, what I called on the example as the five star customers, are only 20% of their total customers but they actually drive 80% of the entire spa profit. This kind of information that a customer profitability analysis will provide is extremely important to any business who wants to be successful. Because most of the time you will understand that a small group of customers are extremely important to your business, and you need to continue to make sure that they keep using your products and services regularly, or even more than they used to. Besides that, you have the opportunity to determine what geographic, demographic and psychographic characteristics they have in common, and use your marketing dollars to drive more customers with the same characteristics to experiment your products. Also, you will have the opportunity to know the customers that are not as good as this 5 stars, but that are close to this group. Meaning that after you concluded analyzing your customer profiles, they are not at the 5 stars customer group but on the 4 or 3 stars groups. By knowing who these persons are, you will be able to build a relationship with them with some marketing tactics that have the goal of moving them into the 5 star customers’. This technique of “pushing” your existing customers into your best customers group, most of the times is easier and cheaper than try to find completely new great customers. Finding other prospective customers with the exact same qualities and attributes as them is also a smart way to spend your marketing dollars. Example: if they are sales professionals’ females that live in a kilometer distance from your shop, with ages between 30 to 45 years old, you should invest in marketing your products to ladies that have the exact same characteristics as your five star customers. This way, you will not waste your marketing money by promoting your products to customers that will bring you not much profit. For your “worst” customers, most of the times I recommend businesses to leave them alone and don’t waste their marketing dollars in trying to transform them into good customers. Often, after studying the customer profitability analysis, company owners recognize that these customers in reality don’t bring much profit to the company and in many cases they are not profitable at all, because when we calculate the net profit, our actual costs and expenses with them are higher than the revenue they brought to the company.
Views: 11440 Paulo Calisto
Startup CEO: Growth vs. Profitability
 
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(0:58) Be frugal early (1:19) When you might grow at the expense of profits (2:01) Capital markets - feelings towards growth and profitability (2:16) The faster you're growing... In this series, Matt Blumberg coaches entrepreneurs through the crucial transitions that turn a startup into a sustainable business and a founder into a CEO. Blumberg explains how thoughtful processes help shape operations, talent development, financing and work-life balance. ABOUT THE KAUFFMAN FOUNDERS SCHOOL Visit the website: [http://bit.ly/1EW2br7] The Kauffman Founders School presents a powerful curriculum for entrepreneurs who wish to learn anywhere, anytime. The online education platform features experts presenting lectures in series modules designed to give Founders a rich learning experience, while also engaging them in lessons that will make a difference in their business today, tomorrow, and in the future. The Kauffman Founders School series modules include Powerful Presentations, Intellectual Property, Founder's Dilemmas, Entrepreneurial Selling, Entrepreneurial Marketing, Surviving the Entrepreneurial Life, Startups, and much more. ©2016 Ewing Marion Kauffman Foundation. May not be used without permission. To enter a request for permission to use, contact [email protected]
Understanding Profit Margin
 
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http://www.MDTSeminar.com Profit margin is part of a category of profitability ratios calculated as net income divided by revenue, or net profits divided by sales. Net income or net profit may be determined by subtracting all of a company’s expenses, including operating costs, material costs (including raw materials) and tax costs, from its total revenue. Profit margins are expressed as a percentage and, in effect, measure how much out of every dollar of sales a company actually keeps in earnings. A 20% profit margin, then, means the company has a net income of $0.20 for each dollar of total revenue earned. While there are a few different kinds of profit margins, including “gross profit margin,” “operating margin,” (or "operating profit margin") “pretax profit margin” and “net margin” (or "net profit margin") the term “profit margin” is also often used simply to refer to net margin. The method of calculating profit margin when the term is used in this way can be represented with the following formula: Profit Margin = Net Income / Net Sales (revenue) Other types of profit margins have different ways of calculating net income so as to break down a company’s earnings in different ways and for different purposes. Profit margin is similar but distinct from the term “profit percentage,” which divides net profit on sales by the cost of goods sold to help determine the amount of profit a company makes on selling its goods, rather than the amount of profit a company is making relative to its total expenditures. Rarely can a company’s individual numbers (like revenue or expenditures) indicate much about the company’s profitability, and looking at the earnings of a company often doesn't tell the entire story. Increased earnings are good, but an increase does not mean that the profit margin of a company is improving. Profit margin is a useful ratio and can help provide insight about a variety of aspects of a company’s financial performance. On a rudimentary level, a low profit margin can be interpreted as indicating that a company’s profitability is not very secure. If a company with a low profit margin experiences a decline in sales, its profit margin will decline even further, leading to a very low, neutral or even negative profit margin. Low profit margins may also reveal certain things about the industry in which a company operates or about broader economic conditions. For example, if a company’s profit margin is low, it may indicate that it has lower sales than other companies in the industry (a low market share) or that the industry in which the company operates is itself suffering, perhaps because of waning consumer interest (or increasing popularity and/or availability of alternatives) or because of hard economic times or recession. Profit margin may also indicate certain things about a company’s ability to manage its expenses. High expenditures relative to revenue (i.e. a low profit margin) may indicate that a company is struggling to keep its costs low, perhaps because of management problems. This is an indication that costs need to be under better control. High expenditures may occur for many reasons, including that the company has too much inventory relative to its sales, that it has too many employees, that it is operating in spaces that are too large and thus is paying too much in rent, and for many other reasons. On the other hand, a higher profit margin indicates a more profitable company that has better control over its costs compared to its competitors. Profit margin can also illuminate certain aspects of a company’s pricing strategy. For example, a low profit margin may indicate that a company is underpricing​ its goods. Though profit margin is a helpful and popular ratio for gauging a company’s profitability, like any financial metric or ratio it comes with certain accompanying limitations that any investor should consider when considering a company’s profit margin. While profit margin can be very useful for comparing companies with one another, one should only use profit margin to compare companies within the same industry, and ideally with similar business models and revenue numbers as well. Companies in different industries may often have wildly different business models, such that they may also have very different profit margins, thereby rendering a comparison of their profit margins relatively meaningless.
Revenue, Profits, and Price: Crash Course Economics #24
 
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How do companies make money? What are profits? Revenues? How are prices set? This week, Jacob and Adriene are talking business. Whether you're selling cars, pizza, or glow sticks, this video has pretty much all the information you need to run a business. Well, not really, but there's a lot of good stuff in here. *** Crash Course is on Patreon! You can support us directly by signing up at http://www.patreon.com/crashcourse Thanks to the following Patrons for their generous monthly contributions that help keep Crash Course free for everyone forever: Mark, Eric Kitchen, Jessica Wode, Jeffrey Thompson, Steve Marshall, Moritz Schmidt, Robert Kunz, Tim Curwick, Jason A Saslow, SR Foxley, Elliot Beter, Jacob Ash, Christian, Jan Schmid, Jirat, Christy Huddleston, Daniel Baulig, Chris Peters, Anna-Ester Volozh, Ian Dundore, Caleb Weeks -- Want to find Crash Course elsewhere on the internet? Facebook - http://www.facebook.com/YouTubeCrashCourse Twitter - http://www.twitter.com/TheCrashCourse Tumblr - http://thecrashcourse.tumblr.com Support Crash Course on Patreon: http://patreon.com/crashcourse CC Kids: http://www.youtube.com/crashcoursekids
Views: 416599 CrashCourse
Financial Ratios & Analysis - Explained in Hindi (2018)
 
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An introduction to Financial Ratio Analysis in hindi. Financial ratios like profitability ratios, liquidity ratios, solvency ratios (leverage or debt ratios), activity ratios (efficiency ratios) and valuation or market ratios are analyzed before making an investment decision or to judge the financial health of a company. Few examples are discussed for each type of ratio for eg. profit margin, current ratio, debt ratio, inventory turnover ratio, earnings per share (EPS) and P/E ratio. Related Videos: Profitability Ratios - Gross, Net, Operating Profit Margin : https://youtu.be/pHgiuO2ZYoU Liquidity Ratios & Solvency Ratios: https://youtu.be/ZMSW9BYb_Yo Return on Investment (ROI): https://youtu.be/ij7y5e2MVG4 Earnings Per Share (EPS): https://youtu.be/SDXp64flfJI इस वीडियो में जानिए फाइनेंसियल रेश्यो एनालिसिस का हिंदी में परिचय। फाइनेंसियल रेश्यो जैसे की प्रोफिटेबिलिटी रेश्यो, लिक्विडिटी रेश्यो, सॉल्वेंसी रेश्यो (लिवरेज या डेब्ट रेश्यो), एक्टिविटी रेश्यो (एफिशिएंसी रेश्यो) और वैल्यूएशन या मार्केट रेश्यो को एनालाइज़ किया जाता है कोई भी निवेश का निर्णय लेने से पहले और किसी कंपनी के फाइनैंशल हेल्थ को जज करने के लिए भी किया जाता है। हर एक प्रकार के रेश्यो के लिए कुछ उदाहरणों पर चर्चा की गयी है जैसे: प्रॉफिट मार्जिन, करंट रेश्यो, डेब्ट रेश्यो, इन्वेंटरी टर्नओवर रेश्यो, अर्निंग्स पर शेयर (EPS) और P/E रेश्यो। Share this Video: https://youtu.be/CZscpOND3Vs Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What are the financial ratios? How financial ratio helps you to understand the financial health of a company? What is the concept of financial ratios? How to analyze a company's financial health using financial ratios? How many types of financial ratios are used for the financial status of a company? What is the meaning of different financial ratios? How to calculate different financial ratio? How to do financial ratio analysis? What is the concept of financial ratio analysis? Which financial ratios can be used to analyze the financial status of a company? What is the basic concept of profitability ratios, liquidity ratios, solvency ratios, activity ratios and market ratios? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Twitter - http://twitter.com/assetyogi Facebook – https://www.facebook.com/assetyogi Instagram - http://instagram.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Linkedin - http://www.linkedin.com/company/asset-yogi Google Plus – https://plus.google.com/+assetyogi-ay Hope you liked this video in Hindi on “Financial Ratios & Analysis”.
Views: 29486 Asset Yogi
Financial analysis made easy (and quick!)
 
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Jean Pousson from Board Evaluation gives a short way to financially assess your business. Find us online: http://bit.ly/1okZTwN LinkedIn: http://linkd.in/1mgjvQe Twitter: http://bit.ly/1g0LxPq
Views: 41379 boardevaluation
Why isn't Tesla broke?
 
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Startup Funding Explained: https://youtu.be/677ZtSMr4-4 The Rest Of Us on Patreon: https://www.patreon.com/TheRestOfUs The Rest Of Us on Twitter: http://twitter.com/TROUchannel The Rest Of Us T-Shirts and More: http://teespring.com/TheRestOfUsClothing Thanks to my bro for the background tune. Soundcloud link: https://soundcloud.com/ininjanic Thanks to my Gold Patrons: friuns YouExec.com Will Tachau Paul Pivaru Frantisek Sumsala Cesar E. Lopez Duncan Kennedy Hannes Ott Leilah Ruan Jonathan Rieke Remy Rojas August Noë
Views: 1528310 The Rest Of Us
How Profitable is Your Company?
 
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With our Profitability Module, learn how to improve your business's profit! Hypothetically model your business to see how changing important items like your product price impacts your profit. You can also see how your industry competitors compare to your company performance - all in IndustriusCFO's Profitability Module. IndustriusCFO / 4117 Liberty Avenue Pittsburgh Pa., 15224 / 412-325-8040 / http://www.industriusCFO.com
Views: 115 IndustriusCFO
DuPont analysis explained
 
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DuPont equation tutorial. ROE: Return On Equity. ROA: Return On Assets. ROS: Return On Sales. This video takes you through the financial ratios of the ROE formula, the ROA formula, the ROS formula, asset turnover and leverage, and shows how they fit together. The very basics and the very essence of financial ratio analysis! ROE or Return On Equity is defined as Net Income divided by Equity. In other words, the net profit that a company has generated during a year, divided by the book value of the shareholder capital invested in the company. ROE is a measure of the rate of return to shareholders. The 3-part version of the DuPont analysis shows you that ROE = ROS x asset turnover x leverage. The first two elements together, ROS multiplied by Asset Turnover, form ROA, Return On Assets. This ratio of ROA has many variations, some companies measure ROIC Return On Invested Capital, ROTC Return On Total Capital, ROCE Return On Capital Employed, or RONOA Return On Net Operating Assets. These are all variations on the same theme, you look at the returns (profit) generated during a period, and compared them to the capital invested in the company to generate those returns. ROA is an indicator of business success, influenced by two factors: ROS or margin performance, and asset turnover which you could call speed or velocity. ROS or Return On Sales, is Net Income divided by Sales, which is an indicator of the relative profitability or operating efficiency: how many cents of profit are generated for every dollar of sales? Asset Turnover is calculated as Sales divided by Assets, a measure of asset use efficiency. The last element of the DuPont 3-part equation is leverage, Assets divided by Equity. You can expand the DuPont formula to 5 steps, if you want even more analytical insight into the drivers of where your ROE increase or decrease is coming from. The two elements on the right stay the same: asset turnover and leverage. However, ROS gets split into three elements: Net Income divided by Earnings Before Tax, which is called tax burden, Earnings Before Tax divided by EBIT, called interest burden, and EBIT divided by sales, which is EBIT%. In a lot of companies, improving the EBIT% and increasing the Asset Turnover, are important targets for the management team, whereas the other elements are for the finance, treasury and tax departments to manage. For an illustration of Return On Assets, my follow-up video analyzing ROA, ROS and asset turnover of Verizon and Walmart is highly recommended https://www.youtube.com/watch?v=2j8bfR8KqJ0 Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Philip delivers training in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
James Webb: How to Read a Financial Statement [Crowell School of Business]
 
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James Webb, Higher Education Executive, Accounting Professor, and CPA, explains how to read a financial statement. Download the Excel file referenced in this video at the link below. http://crowell.biola.edu/blog/2012/nov/12/business-fundamentals-how-read-financial-statement/ The Crowell School of Business regularly hosts a selection of accomplished business leaders that share their varied professional and personal insights in the Distinguished Lecture Series. Learn more about the Crowell School of Business at https://www.biola.edu/crowell
Views: 377344 BiolaUniversity
Profitability Ratios, CFA L1 (Financial Statements)
 
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Return on Sales (income statement) and Return on Invesmtent (returns to balance sheet). For more financial risk videos, visit our website! http://www.bionicturtle.com
Views: 41590 Bionic Turtle
3 Minutes! Financial Ratios and Financial Ratio Analysis Explained (Quick Overview)
 
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OMG wow! So easy clicked here http://mbabullshit.com/ for Financial Ratio Analysis Explained Financial Ratio Analysis Explained in 3 minutes Sometimes it's not enough to simply say a company is in "good or bad" health... To make it easier to compare a company's health with other companies, we have to put numbers on this health, so that we can compare these numbers with the numbers of other companies... So now... how do we use numbers to assess company health? http://www.youtube.com/watch?v=TZZFBkbC2lA This is where Financial Ratios come in... Very common types of financial ratios are Liquidity Ratios, Profitability Ratios, and Leverage Ratios. Liquidity Ratios can tell us how easily a company can pay its debts... so that the company doesn't get eaten up by banks or other creditors. An example of this is the Current Ratio... This tells us how much of your company's stuff can be easily changed into cash within the next 12 months so that it can pay debts which need to be paid also within 12 months. The higher your current ratio is, the less risky a situation your company is in. Now moving on... Profitability Ratios can tell us how good a company is at making money. An example of this is the Profit Margin Ratio. This tells us how much profit your company earns compared to your company's sales. Normally, a higher number is better; because you want to earn more profit for every $1 of sales that you get. And finally, what about Leverage Ratios? These can tell us how much debt the company is using to make the company run and stay alive. An example of this is the simple Debt Ratio. This tells us how much % of a company's assets are paid for by debt. Normally, a company is considered "safer" when the debt ratio is low. Note that this was just a very simple overview. There are a lot more financial ratios & many different ways of using them; plus a lot of problems and disadvantages in using them as well. Would you like to SUPER easily learn more about many financial ratios with even deeper analysis & detail? Check out my FREE videos at MBAbullshit.com See ya there!
Views: 1271252 MBAbullshitDotCom
Profit Margin Explained + Formula: How to Calculate & Use the Profit Margin
 
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Profit Margin Explained + Formula: How to Calculate & Use the Profit Margin. The Profit Margin is a Profitability Ratio that can form part of Your Financial Statement Ratio Analysis. In this video, which is great for the investor, manager or student, you will learn the Formula, where to Find the Data Inputs, what is a Good or Bad Result and some Initial Questions for Your Analysis. Add to your accounting and finance knowledge now for better business decisions and improved stock selection. "The Profit Margin is one of the most popular of all the ratios out there, and for good reason. Ultimately, it tells us how much profit is generated from our sales, specifically the percentage of sales revenue that ends up in profit. It is a key ratio because a primary financial performance measure of a business is profit (it’s the bottom line!). And while profit can’t be generated without sales revenue (selling your product/service is why you’re in business!), expenses are another fact of business life and keeping these expenses as low as possible leads to profit being as great as possible (within your sales range). So if you’re in business or you’re an investor, you need to know how well the business in question keeps its cost under control and how much revenue (an often quoted figure) actually ends up on the bottom line. It’s also important as a measure of ‘pricing power’, i.e. the relative power of the business within its market to charge a premium price and maintain market share." KEYWORDS: profit margin, formula, explained, ratio analysis, profitability, financial ratio, accounting, finance. --------------------- This video was brought to you by accofina. Other accofina Products & Services Free Spreadsheets: 1) Ratio Analysis Calculators & Formulas http://www.accofina.com/ratio-analysis-excel.html 2) Capital Budgeting http://www.accofina.com/capital-budgeting-excel.html 3) Time Value of Money Calculators & Formulas http://www.accofina.com/time-value-money-excel.html 4) 2-Year Monthly Cash Flow Forecast http://www.accofina.com/cash-flow-forecast-excel.html Books: 1) Ratio Analysis Fundamentals http://accofina.com/ratio-analysis-fundamentals.html 2) Balance Sheet Basics http://accofina.com/balance-sheet-basics.html 3) Income Statement Basics http://accofina.com/income-statement-basics.html 4) 331 Great Quotes for Entrepreneurs http://accofina.com/331-great-quotes-entrepreneurs.html 5) Corporate Finance Fundamentals http://accofina.com/corporate-finance-fundamentals.html 6) Free eBook - Accounting: Foundation Inputs & Outputs http://accofina.com/accounting-foundations.html a) Amazon Author Page: http://www.amazon.com/author/axeltracy b) Goodreads Author Page: https://www.goodreads.com/author/show/7450542.Axel_Tracy iOS Apps: 1) Ratio Analysis & Management Accounting Calculators http://accofina.com/management-accounting-ratio-analysis-app.html 2) Ratio Analysis & Management Accounting Calculators 'Lite' http://accofina.com/lite-management-accounting-ratio-analysis-app.html 3) Profitable Pricing http://accofina.com/profitable-pricing-app.html a) Bidi Capital (accofina) Apps http://appstore.com/bidicapitalptyltd Online Learning: 1) Financial Statement Fundamentals http://accofina.com/financial-statement-fundamentals.html a) Udemy Instructor Page https://www.udemy.com/u/axeltracy/ b) YouTube Channel http://www.youtube.com/accofina Free Online Calculators: http://www.accofina.com Social Networking & Contact: 1) Facebook http://www.facebook.com/accofinaDotCom 2) Twitter http://www.twitter.com/accofina 3) LinkedIn https://www.linkedin.com/company/bidi-capital-pty-ltd 4) Google+ http://plus.google.com/+accofina #Accounting #FinancialEducation #FundamentalAnalysis
Views: 15252 AccoFina
Ratio Analysis, Financial Ratio Analysis in Excel
 
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For details, visit: http://www.financewalk.com Ratio Analysis, Financial Ratio Analysis in Excel Financial Ratio Analysis Meaning- " The process of calculating the relationships between various pairs of financial statement values for the purpose of assessing a company's financial condition or performance is called ratio analysis." Users of Financial Analysis Financial Analysis can be undertaken by management of the firm, or by parties outside the firm like owners, creditors, investors and others. The nature of analysis will differ depending on the purpose of the analyst. • Trade creditors- are interested in firm's ability to meet their claims over a very short period of time. Their analysis will, therefore, confine to the evaluation of the firm's liquidity position. • Suppliers of long term debt- on the other hand, are concerned with the firm's long-term solvency and survival. They analyse the firm's profitability over time, its ability to generate cash to be able to pay interest and repay principal and the relationship between various sources of funds i.e. capital structure relationships. Long-term creditors do analyse the historical financial statements, but they place more emphasis on the firm's projected, or pro forma, financial statements to make analysis about its future solvency and profitability. • Investors -- who have invested their money in the firm's shares, are most concerned about the firm's earnings. They restore more confidence in those firms that show steady growth in earnings. As such, they concentrate on the analysis of the firm's present and future profitability. They are also interested in the firm's financial structure to the extent it influences the firm's earnings ability and risk. • Management - of the firm would be interested in every aspect of the financial analysis. It is their overall responsibility to see that the resources of the firm are used most effectively and efficiently, and that the firm's financial condition is sound.
Views: 104801 Avadhut Nigudkar
SWOT Analysis, Company Management, Management Analysis Example
 
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For details, visit: http://www.financewalk.com SWOT Analysis, Company Management, Management Analysis Example: SWOT Analysis A SWOT analysis looks at your company's: • Strengths - to build on • Weaknesses -- to cover • Opportunities -- to capture • Threats -- to defend against It aims to: • Reveal your competitive advantages • Analyse your prospects for sales and profitability • Prepare your company for problems • Allow for the development of contingency plans SWOT Analysis Parameters SWOT Analysis of Infosys Company Management To assess the quality of management , the analyst should ask questions like: • What is the grand design of the management? Does it believe in "staying close to the knitting" or unrelated diversification? • What is the calibure,motivation,integrity,dynamism, and commitment of the top management personnel? • What emphasis is accorded to research and development? • How effective is the organisational structure? • What is the importance assigned to the management development? • How investor-friendly is the management? • How strong the execution capability of the management? • How sound are the management systems of the company? Examples of strong Company management • Tata Group • Infosys • Wipro • Reliance • Bharti Airtel • Larsen & Toubro • ONGC
Views: 9804 Avadhut Nigudkar
Ratio Analysis. Liquidity ratios, solvency ratios, profitability ratios.
 
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I have discussed about liquidity, profitability, solvency and and activity ratios in this video
Views: 27100 Amjad Niaz
Customer Profitability Analysis (Activity Based Costing)
 
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This video shows how to perform profitability analysis using activity-based costing. Many companies serve a variety of customer types. By calculating the profitability of each type of customer, the company can determine which customer types are the most profitable and whether some customers are unprofitable. The profitability of a customer type is determined by charging direct (traceable) costs to the customer type and then allocating indirect costs to the customer type using activity-based costing. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like Edspira on Facebook, visit https://www.facebook.com/Edspira To sign up for the newsletter, visit http://Edspira.com/register-for-newsletter Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin To follow Michael on Facebook, visit https://www.facebook.com/Prof.Michael.McLaughlin
Views: 1741 Edspira
Profitability Ratio Analysis | Accounting | Chegg Tutors
 
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Companies use profitability ratios to determine how well they are generating income compared to accounts on their balance sheet and income statement. It is vital to a companies growth to determine their profitability so they can plan and form better growth strategies. We will cover three primary profitability ratios: Return on Assets, Return on Equity, and Profit Margin. ---------- Accounting tutoring on Chegg Tutors Learn about Accounting terms like Profitability Ratio Analysis on Chegg Tutors. Work with live, online Accounting tutors like Nathan G. who can help you at any moment, whether at 2pm or 2am. Liked the video tutorial? Schedule lessons on-demand or schedule weekly tutoring in advance with tutors like Nathan G. Visit https://www.chegg.com/tutors/Accounting-online-tutoring/?utm_source=youtube&utm_medium=video&utm_content=managed&utm_campaign=videotutorials ---------- About Nathan G., Accounting tutor on Chegg Tutors: Texas State, Class of 2010 Finance/Accounting major Subjects tutored: Accounting TEACHING EXPERIENCE Educated from Texas State University, I received my BBA Accounting in 2010. During college, I would often study with classmates. I noticed how much I enjoyed helping them with Accounting. I then knew I had a skill underutilized. My passion for tutoring fuels my desire to see you succeed. With over 7 years of instructional experience, I will provide the tools to help you master Accounting. Check out my YouTube Channel to learn more about Accounting: https://www.youtube.com/channel/UCCyBG-qtLqfvCdSG34ES8Ag. EXTRACURRICULAR INTERESTS I am a man of many tastes. I really enjoy technology, racquetball, basketball, real estate investing practices, web development, and comedy! I love diversifying my interests so I never get bored lol. Hope to hear from you soon! We'll setup a plan to help you succeed in Accounting. Want to book a private lesson with Nathan G.? Message Nathan G. at https://www.chegg.com/tutors/online-tutors/Nathan-G-862370/?utm_source=youtube&utm_medium=video&utm_content=managed&utm_campaign=videotutorials ---------- Like what you see? Subscribe to Chegg's Youtube Channel: http://bit.ly/1PwMn3k ---------- Visit Chegg.com for purchasing or renting textbooks, getting homework help, finding an online tutor, applying for scholarships and internships, discovering colleges, and more! https://chegg.com ---------- Want more from Chegg? Follow Chegg on social media: http://instagram.com/chegg http://facebook.com/chegg http://twitter.com/chegg
Views: 1497 Chegg
Financial Statement Analysis #5: Ratio Analysis - Profitability Measures
 
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http://www.subjectmoney.com http://www.subjectmoney.com/articledisplay.php?title=Financial%20Statement%20Analysis%20and%20Ratios In this financial ratio analysis lesson we are cover profitability measures. They all have the main purpose of measuring how efficiently the firm manages its operations and assets and are probably the most widely use ratios among financial analyst https://www.youtube.com/user/Subjectmoney https://www.youtube.com/watch?v=tKLcdoFKgp8
Views: 15503 Subjectmoney
Profitability Ratio Analysis-Operating profit margin, Net profit margin, ROCE & ROE
 
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Profitability Ratio Analysis Profitable ratios measure the profitability of a company through the margins & earnings that it generates. Profitability ratios can be classified into Margin ratios – Expresses profitability of the company through ratios like GPM, OPM & NPM Earnings ratios – Expresses profitability of the company through ratios like ROE, ROCE & ROA In this video 4 profitability ratios have been emphasized for Star Motocorp for 31-03-2017 a) OPM b) NPM c) ROCE d) ROE a) OPM – Is calculated as EBIT (aka operating profit)/Sales Operating profits are arrived by deducting COGS and Operating costs from sales. OPM signifies the operating profit (gross profit – operating costs) that the Co. generates for every Rs. 1 of sales that it has recorded. OPM can be higher either because the company is able to sell more of its products at higher prices or control costs or a combination of both. The OPM for Star Motocorp was. 45000/305000 = 15% b) NPM – Net profit/sales The NPM is the after-tax profit that the Co. generates of every Rs. 1 in sales. It is the amount left after deducting fixed and variable costs from revenues. Co. generating higher NPM consistently need to be seen in positive light. The NPM for Star Motocorp was. 35000/305000 = 11% C) ROCE – Is the return that the company makes on the capital that it employs. The Co. has 2 sources of funds namely debt (long + short term borrowing) and equity. The ROCE is calculated as EBIT/(DEBT + EQUITY CAPITAL) Operating profits or EBIT is taken in the numerator as these are the profits that the company has made by running its day to day operations The ROCE for Star Motocorp was 45000/5000+100000 = 43% The company enjoys high ROCE, indicating that it has a competitive advantage d) ROE is the return that the Co. earns on the equity (monies shareholders have invested + retained earnings. ROE is calculated as ROE = Net profit/shareholders equity The ROE for Star Motocorp was 35000/100000 = 35% A higher ROE indicates that the Co. does not have to rely on external capital to grow its business and enjoys a competitive advantage Investors need to study the Dupont model to understand what actually drives the ROE The ROCE & ROE need to be substantially higher than the cost of capital to generate shareholder wealth. It's important for an investor to study the profitability ratios of different companies in the same industry to ascertain how a particular company fairs on this front.
Views: 356 Fintapp
Income Statement Analysis - Beginners Guide
 
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Explanation of how to analyze the balance sheet, including how to calculate key rations and interpret the information. This 5 part series was initially developed to train credit and collection professionals. Free eBook on our web site of the 5 part series Introduction to Financial Statement Analysis has been downloaded almost 10,000 times. Brought to you by commercial collection agency The Kaplan Group www.kaplancollectionagency.com.
Views: 66812 The Kaplan Group
Finance: Liquidity Ratios Explained
 
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Learn more about liquidity ratios here on the tutor2u website: https://www.tutor2u.net/business/reference?q=liquidity+ratio In this short revision video, Jim Riley from tutor2u Business introduces the concept of liquidity ratios and explains how to calculate and interpret the two main ratios: the current ratio and acid-test ratio.
Views: 111592 tutor2u
Ratio Analysis: Return on Capital Employed (ROCE)
 
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This short revision video introduces the concept of Return on Capital Employed.
Views: 73914 tutor2u
Accounting ratios Compare two companies
 
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Comparing two companies: Revision of some simple ratios
Views: 22076 david hopcroft
Profitability Analysis
 
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Comprehensive financial statement analysis here: https://www.finstanon.com/ More on profitability ratios: https://www.finstanon.com/articles/35-profitability-ratio-analysis
Views: 588 Finstanon.com
Financial ratio analysis
 
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How does financial ratio analysis work? Let’s discuss ten of the most popular financial ratios that can help you find the story behind the numbers. What do you need to get started on a financial ratio analysis? You need an income statement, the overview of how much profit a company made during a year. You also need a balance sheet, an overview of what a company owns and what a company owes at a specific point in time. We will start off with financial ratios that only focus on the income statement, then look at financial ratios that only focus on the balance sheet, and end with powerful financial ratios that combine information from the income statement and the balance sheet. Performing a financial ratio analysis has a scientific element to it (finding data and putting it into formulas), as well as an artistic element (assigning meaning to the outcome of the calculations, and seeing the big picture). In this video on financial ratio analysis, we cover ten financial ratios: On the income statement: gross profit %, operating margin %, return on sales % On the balance sheet: current ratio, debt-to-equity, equity as % of total When linking the P&L and the balance sheet: return on equity, asset turnover, receivables turnover, inventory turnover Philip de Vroe (The Finance Storyteller) aims to make strategy, #finance and leadership enjoyable and easier to understand. Learn the business and accounting vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better investing decisions. Philip delivers #financetraining in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Key Financial Metrics and Ratios: ROA, ROE, and ROIC
 
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Learn key financial metrics & ratios to analyze companies financial statements. By http://breakingintowallstreet.com/ "Financial Modeling Training And Career Resources For Aspiring Investment Bankers" You’ll learn about the key metrics and ratios used to analyze companies’ financial statements, including Return on Equity (ROE), Return on Assets (ROA), and Return on Invested Capital (ROIC), as well as Inventory Turnover, Receivables Turnover, Payables Turnover, the Current Ratio, and the Asset Turnover Ratio. Table of Contents: 1:15 Why Metrics and Ratios Matter 4:58 Return on Equity (ROE), Return on Assets (ROA), and Return on Invested Capital (ROIC) 10:50 Asset-Based and Turnover-Based Ratios 14:40 Interpretation of Key Metrics and Ratios for Wal-Mart, Amazon, and Salesforce 19:32 Why the Key Metrics and Ratios Are Sometimes Not That Useful Why Metrics and Ratios? They let you evaluate and compare different companies, and see why one company might be worth more (higher valuation multiple) than others. They let you answer questions such as: How much equity is required to generate a certain amount of after-tax profit (Net Income)? How much in assets is required to generate a certain amount of after-tax profit (Net Income)? How much total capital is required to do this? How dependent is a company on its assets? How liquid is the company? Can it meet its obligations? How quickly does it sell all its Inventory, pay its outstanding invoices, and collect its receivables? ROA, ROA, and ROIC Return on Equity (ROE) = Net Income / Average Shareholders’ Equity Return on Assets (ROA) = Net Income / Average Assets Return on Invested Capital (ROIC) = NOPAT / (Total Debt + Equity + Other Long-Term Funding Sources) Return on Equity (ROE): How efficiently is a company using its equity to generate after-tax profits? Return on Assets (ROA): How well is a company using its assets / how dependent is it on them? Return on Invested Capital (ROIC): How well is a company using ALL its capital, or how much capital is required to grow its business? Here, Wal-Mart easily ranks #1 in all these metrics because it has a very high ROE of 20-25%, an ROA of close to 10%, and an ROIC of 13-14%; for Amazon and Salesforce, these numbers are negative or close to 0%. Asset-Based Ratios and Turnover-Based Ratios Asset Turnover Ratio = Revenue / Average Assets How dependent is a company on its asset base to generate revenue? Current Ratio = Current Assets / Current Liabilities How liquid is a company? Can it use its short-term assets to repay its short-term obligations, if required? Inventory Turnover = COGS / Average Inventory How many times per year does a company sell off all its Inventory? Receivables Turnover = Revenue / Average AR How quickly does a company collect its receivables from customers that haven’t paid in cash yet? Payables Turnover = COGS / Average AP (*) How quickly does a company submit cash payment for outstanding invoices? Interpretation of Figures for Wal-Mart, Amazon, and Salesforce On the surface, many of these metrics make Wal-Mart seem like a "better" company - much higher ROE, ROA, and ROIC, and Amazon is negative on some of those! Wal-Mart tends to have higher margins as well, and shows more consistency with those margins. Similar inventory management, but Wal-Mart collects from customers and pays invoices much more quickly than Amazon. Wal-Mart is levered a bit more heavily, though. And yet… Amazon is a much more expensive stock, or at least it was at this point in time, and the market values it much more highly based on metrics such as the P / E ratio. At the time of this analysis, Wal-Mart P / E Ratio = 16x, and Amazon P / E Ratio = 456x! How could that be possible? Is Amazon really nearly 30x as valuable as Wal-Mart with WORSE metrics? Answer: The "Revenue Growth" line tells the whole story here. You're comparing 2 very different companies – one is a mature, predictable, mostly slow-growing firm, and one is growing revenue at 20-30% per year, despite revenue in the tens of billions already. Admittedly, Amazon's valuation still seems ridiculous, but it's not that surprising it's valued more highly than Wal-Mart, given that it's growing 20-30x more quickly. The Bottom-Line: These metrics are MOST useful when comparing companies of similar sizes, growth rates, and margins – not as useful when you're comparing a high-growth company to a stable, mature firm. RESOURCES http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Key-Financial-Metrics-Ratios.xlsx http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Key-Financial-Metrics-Ratios.pdf http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Amazon-Financial-Statements.pdf http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Salesforce-Financial-Statements.pdf http://youtube-breakingintowallstreet-com.s3.amazonaws.com/105-14-Walmart-Financial-Statements.pdf
Return On Assets explained
 
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How to calculate ROA? What does ROA mean? Return On Assets or ROA is a financial ratio that can help you analyze the performance of a company or business unit and compare the financial performance to others. This video takes you through the Return On Assets formula, shows you how to calculate ROA, how to interpret ROA, and gives suggestions on how to improve ROA. Return On Assets links together information from two of the three main financial statements, by taking the bottom line of net profit from the income statement and the left hand side of assets from the balance sheet. ROA or Return On Assets is defined as Net Income divided by Assets. In other words, the net profit that a company has generated during a year, divided by the book value of the assets that a company owns on the balance sheet date. ROA is an important indicator of business success. Can the company generate a good return on the assets it has invested in? If you want to improve the ROA performance of the company, you can either work on increasing the numerator of profitability, or reducing the amount in the denominator of assets. Profit can be increased by selling more units, charging a higher selling price, improving the product or service mix, realizing productivity and efficiency, achieving sourcing benefits, or reducing the interest or tax charges. Assets can be reduced by shorter credit terms to customers and improved receivables collections, increasing inventory turns, making selective lease versus buy decisions, improving the asset utilization of property, plant and equipment, or divesting lower margin business units or product lines. Here’s another way to look at the drivers of Return On Assets performance. ROA is influenced by two factors: ROS or margin performance, and asset turnover which you could call speed or velocity. Do you want your company to perform better on ROA? Dedicate resources to improving margins, as well as to improving speed. If you want to know more about the context of how ROA Return On Assets fits into financial ratio analysis, then please watch my video on DuPont analysis at https://www.youtube.com/watch?v=bhbDDSohJ84 Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Philip delivers training in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Profitability Ratio Scan
 
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This is a video on Profitability Ratio scan for Stockedge. Profitability Ratio is an important scan to filter stocks based on growth investing. Description- In fundamental analysis of a stock, Profitability of a company is one of the most important aspect to look at. After all, if we don not know whether the company is making profit or how much profit it is making, we would not be able to form any view on it. There are profitability ratios like Return on Equity (ROE), Return on Capital Employed (ROCE) and other ratios that an analyst should look at. StockEdge app provides you ready-made scans using which, you can search companies that are making consistent profit. There are many criteria in the scans which you can use as per your needs to select stocks for further research. Watch this video to use Profitability Scans effectively in StockEdge app. Call to Action You can also buy StockEdge Basic Membership and get access to advanced feature of StockEdge app. https://stockedge.com/Plans/basicmembership Learn Fundamental Analysis- https://www.elearnmarkets.com/courses/display/equity-research-analysis You can follow us on twitter https://twitter.com/mystockedge?lang=en
Views: 362 Stock Edge
Financial Statement Analysis #2: Ratio Analysis - Liquidity (Short Term Solvency)
 
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http://www.subjectmoney.com http://www.subjectmoney.com/articledisplay.php?title=Financial%20Statement%20Analysis%20and%20Ratios In this financial statement analysis tutorial we are covering liquidity measures or short term solvency ratios. Here you will learn about the current ratio, the quick ratio (acid test) and the cash ratio. Short-term solvency measures are used to determine whether or not a company would be able to pay off its short-term liabilities if they were to come due within the near future. Please don't forget to subscribe, rate and share our videos. Please also visit our website at http://www.subjectmoney.com and http://www.excelfornoobs.com https://www.youtube.com/user/Subjectmoney https://www.youtube.com/watch?v=G8v9hF0k3gI
Views: 69966 Subjectmoney
Profitability Ratios
 
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Table of Contents: 04:09 - Return on Assets 05:13 - Return on Sales 06:58 - Asset Turnover Ratio 09:15 - Return on Common Stockholders’ Equity
Views: 191 Rhonda Rodriguez
Topic 6 - Financial statement analysis
 
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A recording of Lecture 6 of Accounting for Managerial Decisions for the Autumn 2016 session. Provides an introduction to financial statement analysis. Recorded on May 5, 2016.
Views: 78874 drdavebond
Learn Financial Ratio Analysis in 15 minutes
 
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This video helps you to learn Calculation of Financial Ratios with the help of practical example
Views: 575551 Ns Toor
Ratio Analysis - Gearing
 
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This revision video explains the concept of gearing and illustrates how the main gearing ratios are calculated and interpreted.
Views: 60645 tutor2u
Understanding Financial Ratios
 
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Courses to help you prepare for the CMA Exams Use the code for 50% discount Pass the CMA Exam the first time -Investment decisions https://www.udemy.com/pass-the-cma-exam-2-the-first-time-investment-decisions/?instructorPreviewMode=guest – Code CMA20171 Pass the CMA Exam the first time -Decision analysis https://www.udemy.com/pass-cma-exam-2-the-first-time-decision-analysis/?instructorPreviewMode=guest– Code CMA2017 Pass the CMA Exam the first time -Financial decision making https://www.udemy.com/cma-exam-2-review-financial-decision-making-section-a/?instructorPreviewMode=guest – Code CMA2017 Pass the CMA Exam the first time - Corporate finance https://www.udemy.com/cma-exam-2-study-program-section-b-corporate-finance/?instructorPreviewMode=guest – Code CMA2017 Pass the CMA #1 exam Planning Budgeting & Forecasting https://www.udemy.com/cma-exam1-study-program-section-b-planning-budgeting/?instructorPreviewMode=guest – Code CMA2017 Know how to be successful in writing the CMA Exam #1 MCQ's https://www.udemy.com/certified-management-accounting-exam-hack-part-1/?instructorPreviewMode=guest– Code CMA2017
Tesla's Road to Profitability
 
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Check out my latest video "Tesla Winter Driving Secrets!" https://www.youtube.com/watch?v=gmnFZCFV5bI --~-- Tesla posted a 300M profit in Q3 of 2018, the first time in 2 years which is a 143% increase of the previous quarter. Let's look at how we got here though. // join our community of Tesla fans at https://teslanomics.co/join Telsa went public on Jan 29th 2010, amidst the financial recovery and without their flagship Model S sedan for sale yet It wasn't until June 22nd 2012 did they finally start to deliver their first real production car which would really drive their growth and solidify them as a contender in the luxury auto space Prior to that the only Tesla in existence was the Roadster which was converted from the Lotus Elise sports car While this was a cool concept and captured the attention of many environmentally friendly celebrities like George Clooney It proved to be somewhat of a terrible approach and thus Tesla went back to the drawing board with their new Chief Design Franz von Holzhausen who has a very German sounding name but grew up in Connecticut As it turns out, building the Model S took a lot of resources leading to a pretty rough financial situation without much of a track record of success. During this time Tesla was spending far more money then they were making to the tune of a 100M loss for Q2 of 2012 and 111M in Q3 // This is where the tides began to shift As Tesla started to deliver the Model S in late Q3 of 2012 the revenue took off, doubling in that quarter alone and growing again by over 500% the next quarter. This growth led to Tesla seeing it's first profitable quarter in Q1 of 2013 to the tune of 11M. Earlier in 2012 Tesla also unveiled their SUV, the Model X, and of course, this took quite a bit of money to start building. So after that profitable quarter in 2013 Tesla began it's next growth phase while it built out the equipment and supply ines for the Model X and again was spending more money than it brought in. This time they were spending a ton more though, as they had some other major expenses during this time giving them a negative net income of over 300M in Q4 of 2015. Things started to change a bit in that time though as Model X deliveries started to roll out bringing in some much needed revenue This gave Tesla their second profitable quarter in Q3 of 2016, this time a total of 22M in Net Income. And as you can probably predict, Tesla and Elon had more plans in the works. The Tesla Model 3, their first mass-market electric car with a price that many more could afford than the previous two models. On March 31st of 2016 Tesla unveiled the Model 3 to the world. The day of thousands around the globe stood inline at stores and put down a thousand dollar deposit along with hundreds of thousands more in the coming days online All for a vehicle they wouldn't receive for at least two years, and some are still waiting today! And of course during that time Tesla had to reconfigure their general assembly plant in Fremont California along with building out large sections of the battery factory in Nevada. As you can imagine these endeavors required large amounts of capital and thus Tesla's profitability again sunk to new lows. In Q2 of 2018 Tesla produced their largest loss to date, spending 718M more then they brought in. This brings us to Q3, when Tesla reported the following: - GAAP net income of $312M, non-GAAP net income of $516M - Operating income of $417M and operating margin of 6.1% - Free cash flow of $881M supported by operating cash flow of $1.4B - $3.0B of cash and cash equivalents at Q3-end, increased by $731M in Q3 - Model 3 GAAP and non-GAAP gross margin over 20% in Q3 - Reaffirm expectation of continued GAAP net income and free cash flow in Q4 // New here? Check out more Most Recent Video - https://goo.gl/k3pWlt Most Popular Video - https://goo.gl/jydACR Subscribe - https://goo.gl/tPDO7v // Shoot me a msg online fb https://fb.com/teslanomics tw https://twitter.com/teslanomicsco // My Gear Books https://kit.com/teslanomicsco/books-i-ve-actually-read Tech https://kit.com/teslanomicsco/tech-gear Camera - https://kit.com/teslanomicsco/camera-gear Model 3 Essentials - https://kit.com/teslanomicsco/tesla-model-3-essentials // Music by Epidemic Sound // Disclaimer This video and channel are not affiliated with Tesla nor did they endorse this specific production.
Comparable Company Analysis (CCA) Tutorial
 
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In this tutorial, you’ll learn all about Comparable Company Analysis (CCA), also known as “Public Comps” or “Comps” – including why it works, what it tells you, and how to complete the process efficiently without access to expensive subscription services. https://breakingintowallstreet.com/ "Financial Modeling Training And Career Resources For Aspiring Investment Bankers" Table of Contents: 1:28 What Does “Comparable Company Analysis” Mean? 3:21 How Does the Process Work? 13:09 How Can You Complete a Comparable Company Analysis Cheaply and Quickly? 17:24 What Makes This Harder in Real Life? 19:26 Recap and Summary Resources: https://youtube-breakingintowallstreet-com.s3.amazonaws.com/107-21-Comparable-Company-Analysis.xlsx https://youtube-breakingintowallstreet-com.s3.amazonaws.com/107-21-Comparable-Company-Analysis-Slides.pdf Lesson Outline: The basic idea is that you calculate a company’s “Implied Value” – what it should be worth – based on what other, similar companies are worth. For example, Company A has an Enterprise Value of $1,000, with an EBITDA of $100 and, therefore, an EV / EBITDA of 10x. Other, similar companies in the market have EV / EBITDA multiples between 11x and 13x. Therefore, Company A should also trade at an EV / EBITDA of 11x to 13x, and its Enterprise Value should be between $1,100 and $1,300. Unlike a DCF, which is mostly based on your views of Company A and its long-term prospects, Comparable Company Analysis (“CCA”) is based on the market’s views of this industry. It’s a supplemental methodology since its usefulness depends on how correct the market is. The Process To value a company with CCA, follow these steps: Step 1: Select an appropriate set of comparable public companies. Step 2: Determine the metrics and multiples you want to use. Step 3: Calculate the metrics and multiples for all the companies. Step 4: Apply the median or 25th or 75th percentile multiples from the set to your company to estimate its Implied Equity Value and Enterprise Value. You normally screen companies by geography, industry, and financial “size,” and you aim for around 5-10 companies in the set. An example screen would be “U.S.” for geography, “Steel Manufacturers” for industry, and “revenue between $1 billion and $20 billion” for size. You want the companies to have similar Discount Rates and Cash Flows so that differences in the multiples come from differences in Growth Rates. Normally, you want 1 sales-based metric and 1-2 profitability-based metrics and their corresponding multiples, over both historical and projected periods. Examples might be Revenue, EV / Revenue, and Revenue Growth; EBITDA, EV / EBITDA, and EBITDA Growth; and Net Income, P / E, and Net Income Growth. You calculate each company’s Equity Value and Enterprise Value first, get the historical figures from annual and quarterly reports, and get the projected figures from online sources such as Finviz or Zacks or equity research reports. Then, you calculate the min, 25th percentile, median, 75th percentile, and max for each multiple and multiply them by the appropriate company figures (e.g., LTM EBITDA by the median LTM EV / EBITDA multiple from the comparables). You then back into Implied Equity Value, if necessary, and divide by the share count to calculate the Implied Share Price. Completing the Analysis Quickly and Cheaply You can use Finviz, Zacks, or Motley Fool to find companies and basic financial information. Search by the name of the company you’re valuing on these sites and then click through to “Industry” section to find peers. Click through to “Financial Highlights” or “Statements” to find the projected numbers, and for EBITDA and similar metrics, make estimates by applying the projected EPS growth rate to the historical EBITDA figures to calculate projected EBITDA. Real-Life Complexities This analysis is often more complicated and time-consuming in real life because you may have to search through each company’s filings manually and look for the financials, you might have to determine whether or not an expense is non-recurring, and you may have to “calendarize” the financials if, for example, one company’s fiscal year ends on June 30th but another’s ends on September 30th.
Financial Statement Analysis #3: Long Term Solvency Measures or Leverage Ratios
 
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http://www.subjectmoney.com http://www.subjectmoney.com/articledisplay.php?title=Financial%20Statement%20Analysis%20and%20Ratios In this financial statement analysis tutorial we cover long-term solvency measure also known as leverage ratios. In this tutorial we cover the total debt ratio, the debt to equity ratio, the equity multiplier the TIE ratio and the cash coverage ratio. Please don't forget to subscribe, rate, & share our videos. Please also visit our websites http://www.subjectmoney.com & http://www.excelfornoobs.com https://www.youtube.com/user/Subjectmoney https://www.youtube.com/watch?v=qg1N9_CQtyk
Views: 40990 Subjectmoney
Deciding whether to Drop a Product Line
 
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When deciding whether to drop a product line, the only things that should be considered are the contribution margin provided by the product line and the fixed costs that could be avoided by dropping the product line. This is important because fixed costs are sometimes allocated to product lines, which can distort managerial decision-making by creating the appearance that the firm would be more profitable by dropping a product line that may appear unprofitable because it is being allocated fixed costs that would not disappear if the product line were dropped. Edspira is your source for business and financial education. To view the entire video library for free, visit http://www.Edspira.com To like us on Facebook, visit https://www.facebook.com/Edspira Edspira is the creation of Michael McLaughlin, who went from teenage homelessness to a PhD. The goal of Michael's life is to increase access to education so all people can achieve their dreams. To learn more about Michael's story, visit http://www.MichaelMcLaughlin.com To follow Michael on Facebook, visit https://facebook.com/Prof.Michael.McLaughlin To follow Michael on Twitter, visit https://twitter.com/Prof_McLaughlin
Views: 33144 Edspira
Tesla's Profitability Vs Other Automakers (Gross Margin Analysis)
 
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Tesla's gross margins are already higher than Mercedes, BMW, etc ... and that's before legacy auto co's take a hit on profits to start building EVs. Tesla's commitment to robotic automation in its factory and vertically integrating battery production is starting to pay off big time. In this episode we present evidence (gross margins) for why Tesla's manufacturing strategy is winning. LINK - Google doc w/ all my gross margin calculations & sources: https://docs.google.com/spreadsheets/d/1MznsaZN9WGTN60EJaFQC33rdBXhz8wt4_xh1OFXc8x0/edit?usp=sharing LINK - Tesla Financials Q2 '17: http://files.shareholder.com/downloads/ABEA-4CW8X0/4816704198x0x952053/F302D22F-FC9B-41A3-9534-60D0032673CC/TSLA_Update_Letter_2017-2Q.pdf LINK - Elon Musk says marginal cost of Model S is $30K: https://electrek.co/2017/05/15/tesla-kill-auto-industry-elon-musk-manufacturing-spacex-cto/ LINK - Elon Musk's incentive package from 2012: https://www.sec.gov/Archives/edgar/data/1318605/000119312513158904/d506419ddef14a.htm LINK - Tesla reducing pricing of Model X: https://electrek.co/2017/08/04/tesla-model-x-price-performance-options/ LINK - GM losing $9K on every Bolt: https://electrek.co/2016/11/30/gm-chevy-bolt-ev-loss-before-zev-credit/ LINK - Bob Lutz thinks the Bolt will lose money: https://cleantechnica.com/2015/12/27/bob-lutz-thinks-chevy-bolt-will-lose-gm-money/ LINK - Fiat CEO says he's losing $500K on every 500e: https://www.bloomberg.com/news/articles/2017-10-02/fiat-chrysler-ceo-focuses-on-goals-amid-doubts-on-e-cars-deals LINK - Daimler CEO says EQ brand only to carry half the margins of ICE cars: https://www.reuters.com/article/us-daimler-strategy-costs/electric-cars-only-half-as-profitable-at-first-daimler-idUSKCN1BM0ZV LINK - Pics of robots in Tesla factory: https://electrek.co/2017/04/25/tesla-model-3-robot-production-line-pictures/ LINK - Tesla Gigafactory: https://www.tesla.com/gigafactory Music by Marko: https://soundcloud.com/markothedon & Fritz Carlton: https://soundcloud.com/fritzcarlton HyperChange Patreon: http://patreon.com/hyperchange HyperChange TV Main Website: http://hyperchangetv.com HyperChange Instagram: http://instagram.com/Hyperchange HyperChange Twitter: https://twitter.com/HyperChangeTV HyperChange Facebook: https://www.facebook.com/HyperChange/ Disclaimer: This video is purely my opinion and should not be regarded as factual information. I am not a financial advisor. This is not a recommendation to buy or sell securities. Do not assume any facts and numbers in this video are accurate. Always do your own due diligence. As of 10/11/2017 HyperChange host (Galileo Russell) is invested in shares of Tesla (TSLA).
Views: 3837 HyperChange TV
Law Firm Profitability Analysis
 
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Law firm profitability software that offers deep analysis and invaluable insights into the drivers of your business. Understand which are the positive drivers of your law firm, and which are not. Inform your decisions with sound law firm analytics to deliver a compelling competitive advantage, improved service to clients, and enhanced law firm profitability analysis.
Financial Statement Analysis #1: Common Size Statements and Operation Analysis
 
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http://www.subjectmoney.com http://www.subjectmoney.com/articledisplay.php?title=Financial%20Statement%20Analysis%20and%20Ratios In this lesson we are introducing you to financial statement analysis. We cover common size standardized statements, we cover measures of income and also financial ratios that can be used to analyze the way a company operates along with other features such as the companies financial structure. Please be sure to subscribe, rate, share and don't forget to visit our website at http://subjectmoney.com https://www.youtube.com/user/Subjectmoney https://www.youtube.com/watch?v=TjZCpmtg1Kw
Views: 45742 Subjectmoney
Financial Ratios -- Profitability and Market Value Ratios
 
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This video walks through the calculation and interpretation of the gross profit margin, operating profit margin, net profit margin, return on assets, return on equity, price-earnings, market-book, and dividend-yield ratios
Views: 43140 Kevin Bracker
EBIT and EBITDA explained simply
 
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What do EBIT and EBITDA mean? How to calculate EBIT and EBITDA? Why are the financial metrics EBIT and EBITDA important to measure the financial success of a company? Why do some companies use EBIT (Earnings Before Interest and Taxes) and others EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization)? What is the purpose of the financial statements of a company: income statement, balance sheet, and cash flow statement? What are EBIT and EBITDA used for in business? Both EBIT and EBITDA are measures of profitability, along with terms like gross profit and net income. They are reported in the income statement (or "Profit & Loss statement", "P&L"), an overview of the profit or income that you generate during a period. To calculate EBIT and EBITDA, many companies would present their income statement in the following way: Revenue minus Cost Of Sales equals Gross Profit. Gross Profit minus S,G&A and R&D equals EBITDA. EBITDA minus Depreciation & Amortization equals EBIT. EBIT minus Interest and Taxes equals Net Income. Please be aware that different companies use different terminology, so what you see here might be different from what your company is using. EBIT is Earnings Before Interest and Taxes. Interest is excluded, as it depends on your financing structure. How much did you borrow, and at what interest rate? Taxes are excluded, because it depends on the geographies that you work in. EBITDA is Earnings Before Interest, Taxes, Depreciation and Amortization. Just like EBIT, it excludes Interest and Taxes. Furthermore, depreciation and amortization are excluded, because they depend on the historical investment decisions that a company has made, not the current operating performance. EBITDA is a meaningful metric for capital-intensive industries. In the video, we look at an example of using EBIT and EBITDA in financial reporting, by reviewing the 2015 annual report of the Maersk Group (CPH: MAERSK-B), a company headquartered in Denmark and operating globally. What do business and finance people use EBITDA for? Besides being a metric to represent ongoing operating performance, it is often mentioned as part of M&A (or Mergers & Acquisitions) news. A quick-and-dirty way to calculate the value of a company is by using a multiple of EBITDA. This can help you to get to a ballpark number, but I would advise to always do a more thorough analysis and a more thorough valuation of a company, as there are a lot of “ifs” connected to using an EBITDA multiple… you are assuming the profitability and the industry does not change, you exclude the impact of working capital (which could go up dramatically for a fast-growing company), and you exclude the cash that you need for capital expenditures on an ongoing basis for the company. Related videos in the Finance Storyteller series: EBITDA example https://www.youtube.com/watch?v=7e_6qEo1grI SG&A Selling General and Administrative expenses: https://www.youtube.com/watch?v=5S9xjBXx5v0 Depreciation: https://www.youtube.com/watch?v=6SY8s1_OEro EPS Earnings Per Share: https://www.youtube.com/watch?v=TXjkQy5KJog Philip de Vroe (The Finance Storyteller) aims to make strategy, finance and leadership enjoyable and easier to understand. Learn the business vocabulary to join the conversation with your CEO at your company. Understand how financial statements work in order to make better stock market investment decisions. Philip delivers training in various formats: YouTube videos, classroom sessions, webinars, and business simulations. Connect with me through Linked In!
Views: 147726 The Finance Storyteller
Return on Investment (ROI) - Calculation, Formula & Meaning (Hindi)
 
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ROI or Return on Investment calculation, formula and meaning are explained hindi. ROI is a profitability ratio which is also known as Return on Capital. In this video we learn the basics of Return on Investment. In coming videos, we will learn in detail about Return on Assets, Return on Capital Employed (ROCE) and Return on Equity. Related Videos: Return on Equity (ROE): https://youtu.be/K-OhdUGqdzc ROCE (Return on Capital Employed): https://youtu.be/FjWuma0U2x0 Return on Assets: https://youtu.be/7z9jDKNub6U Profitability Ratios: https://youtu.be/pHgiuO2ZYoU Financial Ratios & Analysis: https://youtu.be/CZscpOND3Vs इस वीडियो में ROI या Return on Investment की कैलकुलेशन, फार्मूला और मीनिंग को हिंदी में समझाया गया है। ROI एक प्रोफिटेबिलिटी रेश्यो होता है जिसे रिटर्न ऑन कैपिटल के रूप में भी जाना जाता है। इस वीडियो में हम Return on Investment के बारे में कुछ आधारभूत बातों के बारे में जानेंगे। आने वाले वीडियो में हम रिटर्न ऑन एसेट्स, रिटर्नऑन कैपिटल एम्प्लॉयड (ROCE) और रिटर्न ऑन इक्विटी के बारे में विस्तार से समझेंगे। Share this Video: https://youtu.be/ij7y5e2MVG4 Subscribe To Our Channel and Get More Property and Real Estate Tips: https://www.youtube.com/channel/UCsNxHPbaCWL1tKw2hxGQD6g If you want to become an Expert Real Estate investor, please visit our website https://assetyogi.com now and Subscribe to our newsletter. In this video, we have explained: What is the return on investment or ROI? What is the meaning of ROI? How to calculate ROI? What is the full form of ROI? What is the method of return on investment calculation? How to implement the ROI calculation formula? How to calculate the expected return on investment? How to apply the ROI formula to calculate the profitability ratio of an investment? How to calculate Return on Capital? How to ROI calculation can help making a right investment decision? How to compare investment opportunities using return on investment formula? How to avoid losses using ROI calculation? How to calculate the overall profit of an investment? What is the return on capital? Make sure to Like and Share this video. Other Great Resources AssetYogi – http://assetyogi.com/ Follow Us: Linkedin - http://www.linkedin.com/company/asset-yogi Google Plus – https://plus.google.com/+assetyogi-ay Twitter - http://twitter.com/assetyogi Instagram - http://instagram.com/assetyogi Pinterest - http://pinterest.com/assetyogi/ Facebook – https://www.facebook.com/assetyogi Hope you liked this video in Hindi on “Return on Investment (ROI)”.
Views: 24582 Asset Yogi
Financial Statement Analysis: Vertical Analysis - Financial Accounting video
 
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Discussion of the different ways of performing financial statement analysis including examples of ratio calculations and comparisons. Accompanying lecture notes: http://tiny.cc/nw1enw -- Thank you all for your wonderful support. Because of your support we have been able to reach and help numerous accounting students all over the world. Please continue to be a part of our mission to help other accounting students be successful by giving our videos thumbs up, adding our videos to your favorites and subscribing to our YouTube channel (click on more info on the videos). Subscribe: http://www.youtube.com/subscription_center?add_user=routhwsuedu Friend me on Facebook: http://www.facebook.com/TheAccountingDoctor -- Other videos in this series: Part 1 - Introduction to Financial Statement Analysis Part 2 - Horizontal Analysis Part 3 - Trend Analysis Part 5 - Comparing One Company with Another Part 6 - Using Ratios and Comparing to Industry Averages (Part 1) Part 7 - Using Ratios and Comparing to Industry Averages (Part 2) Part 8 - Using Ratios and Comparing to Industry Averages (Part 3) Part 9 - Using Ratios and Comparing to Industry Averages (Part 4) Part 10 - Using Ratios and Comparing to Industry Averages (Part 5) For more accounting/how to eLectures (and accompanying lecture notes), blog and a discount textbook-store visit http://www.TheAccountingDr.com Please note that videos may require Flash media and may not play on devices without Flash capabilities (i.e. iPad). You may view the entire video without Flash media at http://www.TheAccountingDr.com. Financial Statement Analysis - Vertical Analysis video by TheAccountingDr: http://youtu.be/OT1BVZPNfks