Understand the valuation ratios, profitability measures, growth metrics, leverage checks and cash-flow signals used throughout Stock Analyzer.
A practical glossary for the key numbers you see in the dashboard: what each metric means, how it is commonly calculated, and how to interpret it with context.
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Valuation tells you what price the market is paying for earnings, sales, assets, or cash flow. A metric is not cheap or expensive by itself; compare it with peers, growth quality, and interest-rate regime.
Shows how much investors pay for each dollar of earnings. A higher P/E often reflects stronger growth expectations or lower perceived risk.
Formula: Share Price / EPS
Example: If price is 120 and EPS is 6, P/E = 120 / 6 = 20x.
Report fields: Market price (quote feed) and EPS from Income Statement (net income attributable to common / diluted shares).
Like P/E, but based on expected next-12-month earnings. Useful when future profit expectations matter more than the last reported year.
Formula: Share Price / Forward EPS
Example: If price is 120 and forward EPS is 8, Forward P/E = 15x.
Report fields: Market price (quote feed) and forward EPS from analyst consensus or company guidance (not directly from historical statements).
Adjusts P/E by growth rate, which can help compare businesses expected to compound earnings at different speeds.
Formula: P/E / EPS Growth (%)
Example: If P/E is 20 and EPS growth is 10%, PEG = 20 / 10 = 2.0.
Report fields: P/E from market + EPS growth from quarterly/annual EPS trend or analyst growth estimates.
Useful when earnings are volatile or negative, especially for early-stage growth companies, cyclical businesses or firms reinvesting heavily.
Formula: Market Cap / Revenue
Example: If market cap is 50B and revenue is 10B, P/S = 5x.
Report fields: Market cap (quote feed) and Revenue from Income Statement (annual or trailing 12-month sales).
Profitability shows whether revenue becomes durable profits. Look for stability over multiple cycles, not one quarter.
Profit allocated to each share. EPS is a core input for P/E and a key signal for earnings momentum.
Formula: Net Income / Weighted Avg Shares
Example: If net income is 2B and shares are 500M, EPS = 4.00.
Report fields: Income Statement: Net income attributable to common + weighted average shares (basic/diluted).
Measures efficiency after direct production costs. Higher gross margins often indicate pricing power, product mix strength or scale advantages.
Formula: (Revenue - COGS) / Revenue
Example: Revenue 10B and COGS 6B gives gross margin = 40%.
Report fields: Income Statement: Revenue and Cost of Revenue (COGS), or Gross Profit if disclosed.
Measures profitability after core operating expenses, showing business model discipline before financing costs and taxes.
Formula: Operating Income / Revenue
Example: Operating income 1.8B on revenue 10B means margin = 18%.
Report fields: Income Statement: Operating Income (EBIT) and Revenue (quarterly or annual).
Shows final profitability after all expenses and helps measure bottom-line resilience across market cycles.
Formula: Net Income / Revenue
Example: Net income 1.2B on revenue 10B gives net margin = 12%.
Report fields: Income Statement: Net Income and Revenue.
Shows how effectively management turns shareholder capital into profit.
Formula: Net Income / Shareholder Equity
Example: Net income 1.2B and equity 6B gives ROE = 20%.
Report fields: Net Income from Income Statement; Total Shareholder Equity from Balance Sheet.
Shows how efficiently total assets produce profit, which is especially useful for banks, manufacturers and capital-heavy businesses.
Formula: Net Income / Total Assets
Example: Net income 1.2B and assets 20B gives ROA = 6%.
Report fields: Net Income from Income Statement; Total Assets from Balance Sheet.
Earnings can include accounting estimates; cash flow reveals what is actually generated. Long-term quality often tracks free cash flow better than headline EPS alone.
Cash produced by day-to-day operations before capital spending, financing activity or acquisitions.
Formula: Cash from Core Operations
Example: If operating activities report 1.5B cash in a year, OCF = 1.5B.
Report fields: Cash Flow Statement: Net cash provided by operating activities.
Cash left after maintaining or expanding assets. It can support dividends, buybacks, debt reduction and reinvestment.
Formula: OCF - Capital Expenditures
Example: OCF 1.5B minus capex 0.5B gives FCF = 1.0B.
Report fields: Cash Flow Statement: Operating cash flow and Capital Expenditures (investing activities).
Shows how much of each revenue dollar becomes free cash. Higher and stable margins usually point to stronger execution.
Formula: FCF / Revenue
Example: FCF 1.0B and revenue 10B gives FCF margin = 10%.
Report fields: FCF from Cash Flow Statement; Revenue from Income Statement (same period).
Measures cash return relative to company value and is often used to compare valuation across mature businesses.
Formula: FCF / Market Cap
Example: FCF 1.0B and market cap 20B gives FCF yield = 5%.
Report fields: FCF from Cash Flow Statement + Market Cap from quote/market data feed.
These metrics focus on survivability and financial flexibility, especially during higher rates or weaker demand.
Liquidity cushion for downturns, M&A, and investments.
Read with Total Debt and FCF trend
Example: A company with 3.2B cash has stronger liquidity than one with 0.4B.
Report fields: Balance Sheet: Cash and Cash Equivalents (or Cash and Short-Term Investments).
Borrowings that require servicing. Not always bad, but must be supported by stable cash generation.
Look at debt maturity + interest coverage
Example: If debt is 4.6B and cash is 3.2B, net debt is about 1.4B.
Report fields: Balance Sheet: Short-term debt + Long-term debt (or Total Debt line item).
Leverage level relative to shareholder capital.
Formula: Total Debt / Shareholder Equity
Example: Debt 4.6B divided by equity 6.0B gives D/E = 0.77.
Report fields: Balance Sheet: Total Debt and Total Shareholder Equity.
Near-term liquidity measure for meeting obligations due within one year.
Formula: Current Assets / Current Liabilities
Example: Current assets 5.4B and liabilities 3.0B gives current ratio = 1.8.
Report fields: Balance Sheet: Total Current Assets and Total Current Liabilities.
Yield is only part of the story. Sustainability depends on payout ratio, cash flow coverage, and debt load.
Annual dividend as a percentage of share price. A higher yield can be attractive, but it may also warn of payout risk.
Formula: Annual Dividend per Share / Share Price
Example: Dividend 2.40 and share price 60 gives dividend yield = 4.0%.
Report fields: Dividend per share from company filings/data feed; Share price from market quote.
Portion of earnings paid as dividends. Very high payout ratios reduce flexibility if earnings fall.
Formula: Dividend per Share / EPS
Example: Dividend 2.40 and EPS 4.00 gives payout ratio = 60%.
Report fields: Dividend per share from distribution records + EPS from Income Statement.
Consistency of dividend increases over time, usually signaling cash-flow confidence and capital discipline.
Track 3Y, 5Y, and 10Y growth trends
Example: If dividend rises from 1.00 to 1.20 in one year, growth = 20%.
Report fields: Historical dividend per share series from company filings or dividend history dataset.
Checks whether dividends are funded by real cash generation, not accounting profit alone.
Formula: FCF / Dividends Paid
Example: If FCF is 900M and dividends paid are 300M, coverage = 3.0x.
Report fields: FCF from Cash Flow Statement; Dividends Paid from financing cash flow section.
Technical indicators help describe price trend, momentum, volatility, and chart structure. Use them as a research layer, not as standalone buy or sell instructions.
Measures recent momentum on a 0 to 100 scale and helps flag overbought or oversold conditions.
Formula: 100 - (100 / (1 + Average Gain / Average Loss))
Example: RSI above 70 is usually extended; RSI below 30 is usually oversold.
Report fields: Calculated from stored daily close prices.
Compares fast and slow exponential moving averages to identify momentum shifts and crossovers.
Formula: EMA 12 - EMA 26; Signal = EMA 9 of MACD
Example: A positive MACD histogram means MACD is above its signal line.
Report fields: Calculated from stored daily close prices.
Shows a volatility envelope around a moving average, helping identify extensions, squeezes, and breakouts.
Formula: SMA 20 +/- 2 standard deviations
Example: Price above the upper band is treated as a bullish breakout signal.
Report fields: Calculated from stored daily close prices.
Uses prior swing lows and highs to estimate nearby price areas where buyers or sellers may react.
Method: recent swing lows for support; recent swing highs for resistance
Example: A close within 3% of support is labeled near support.
Report fields: Calculated from stored daily high, low, and close prices.
Use this as a fast sanity check before deeper analysis. Always compare with the company's own history and peer group.
| Metric | Usually Better When | Common Caution |
|---|---|---|
| P/E Ratio | Reasonable vs company growth and peer group | Can look cheap when earnings are temporarily inflated |
| EPS | Growing consistently across multiple quarters/years | Share buybacks can lift EPS even if core profit growth is weak |
| ROE | Strong and stable without excessive leverage | High debt can artificially boost ROE |
| Debt-to-Equity | Moderate and manageable for the industry | Too high can increase refinancing and downturn risk |
| Free Cash Flow (FCF) | Positive and growing | Capex spikes can create short-term drops |