The price-earnings ratio is the second major valuation ratio profiled in Axel Tracy's book, Ratio Analysis Fundamentals: How 17 Financial Ratios Can Allow You to Analyse Any Business on the Planet.

Few ratios or financial ideas are better known than earnings per share, or "EPS," the figure that tells us how much profit we've earned (or not) on each share of our investments. Still, there are some ...

Return-on-equity (ROE) is the correct profit metric to evaluate the performance of a business. However, the primary emphasis on financial ratio analysis must be on operating performance. The “advanced ...

The price-to-earnings ratio (P/E) is among the most important and commonly used valuation metrics in the fundamental analysis of stocks. It is also referred to as the price multiple, or the earnings ...

Accurately forecasting a business's human resource needs is vital for a small company. If you have too many employees, you place a strain on your resources. Having too few employees minimizes your ...

Financial ratios are an indicator of health for any business. They may seem esoteric, but to lenders and investors they tell the true story of a company's financial strength and ability to weather an ...

Ratio analysis assesses company performance using financial ratios. ITW improved profit margins and FCF through strategic alignment. ITW's stock outperformed S&P 500 over a decade, showing strategic ...

Brian Beers is a digital editor, writer, Emmy-nominated producer, and content expert with 15+ years of experience writing about corporate finance & accounting, fundamental analysis, and investing.