KEYFINANCIALRATIOSFORTHECFAEXAM

LIQUIDITYRATIOS
Currentratio

Quickratio

Cashratio

Defensiveinterval

Currentassets
Currentliabilities

DOH+DSO

Cashconversion
ratioornet

DOH+DSO
#daysA/P

ACTIVITIYRATIOS
Inventoryturnover =
Days'inventoryon
=
hand(DOH)

Days'sales
outstanding(DSO)
Payablesturnover
(A/PT/O)
#days'payables

ReturnonSales
Grossprofit
Gross(profit)margin =
Netsales

$+mkt.secs.+A/R
Currentliabilities Operatingprofit
(EBIT)margin
$+mkt.secs.
=
Currentliabilities Pretax(profit)
margin
$+mkt.secs.+A/R
=
Daily$expenditures
Netprofitmargin

Operatingcycle

Receivables
turnover(A/RT/O)

PROFITABILITYRATIOS

CGS
Ave.inventory
Daysinperiod
InventoryT/O

Creditsales
Ave.A/R

Daysinperiod
A/RT/O

Purchases
Ave.A/P

Daysinperiod
A/PT/O

WorkingcapitalT/O =

Netsales
Ave.W/K

Fixedasset(FA)T/O =

Netsales
Ave.fixedassets

Totalasset(TA)T/O =

Netsales
Ave.TA

Oper.inc.(EBIT)
Netsales

Pretaxinc.(EBT)
Netsales

Netincome
=
Netsales
ReturnonInvestment
EBIT
Operatingreturnon
=
assets
Ave.TA
Returnonassets
(ROA)
Returnontotal
capital(ROC)

Netincome
Ave.TA

EBIT
Debt+S/E

Returnoncommon
=
equity(ROE)

NIpfd.div.
Avecommoneq.

SOLVENCYRATIOS
DebtRatios(interestbearingdebt)
Debttototalassets
Debt
=
ratio
TA
Debttototalcapital
=
ratio

Debt
Debt+S/E

Debttoequityratio =

Debt
S/E

Financialleverage
Ave.TA
=
ratio
AveS/E
CoverageRatios
EBIT
Interestcoverage
=
ratios
interest
Fixedcharge
coverage

VALUATIONRATIOS
Price/earnings

Price/share
EPS

Price/cashflow

Price/share
CF/share

Price/sales

Price/share
Sales/share

Price/bookvalue

Price/share
BV/share

PERSHAREQUANTITIES
BasicEPS

NIpfd.div.
Wtd.ave.C/SO/S

DilutedEPS

Dilutedearnings
DilutedC/SO/S

Cashflow/share

CFO
AveC/SO/S

EBITDA/share

EBITDA
AveC/SO/S

Dividends/share

Com.div.declared
Wtd.ave.C/SO/S

DIVIDENDRELATEDQUANTITIES
Dividendpayout
ratio

Commondividends
NIpfd.div.

Earningsretention
ratio(ERR)

NIalldividends
NIpfd.div.

Sustainablegrowth
rate

ERRxROE

FREECASHFLOW(FCF)
FCFtothefirm
CFO
+Int.x(1taxrate)
Capitalexp.
=FCFF

FCFtoequity
CFO
Capitalexp.
+debt
=FCFE

EBIT+leasepmts.
Int.+leasepmts.

DUPONTANALYSIS
TRADITIONALDUPONT
Profitmargin
x
EXTENDEDDUPONT
Taxburden
x
NI
x
EBT
ROA
x
Netincome
x
AveTA
Profitmargin
x
Netincome
x
Sales
Taxburden
x
Netincome
x
EBT

AssetT/O

Fin'lLeverage

Interestburden
EBT
EBIT
Fin'lleverage
AveTA
AveS/E
AssetT/O
Sales
AveTA
Interestburden
EBT
EBIT

EBITmargin
EBIT
Sales
ROE

ROE

ROA

ROA

EBTmargin
EBIT
Sales

= ROE
x
x

AssetT/O
Sales
AveTA

Profitmargin

Profitmargin

x
x

Fin'lleverage
AveTA
AveS/E

ROE

ROE

R.G.Quintero&Co.