In this course, you will :
- Determine the financial statement on which you can find the source of financing for a company's acquisition of assets.
- Name the category from which liabilities must be paid.
- Explain what you're looking for when you examine a company's operating income percentage.
- Describe the steps involved in calculating accounts receivable turnover.
- Determine the two components to be used in calculating the current ratio.
- Remember the stumbling block you must avoid when performing financial ratio analysis.
1. What Is Financial Ratio Analysis?
- Introduction to financial ratio analysis
2. A Review of the Financial Statements
- What are the financial statements?
- The balance sheet
- The income statement
- The statement of cash flows
3. The DuPont Framework
- The DuPont company: creating accounting history
- Return on equity
- DuPont framework
- DuPont framework: Target and Walmart
- Problem description to explanation
4. Common-Size Financial Statements
- Olympic medals and GDP per capita
- Common size overview
- Target's common-size income statement
- Target's common-size balance sheet
5. Profitability Ratios
- McDonald's most profitable items
- Comparing profitability with financial ratios
- Specific profitability ratios
- Price-earnings ratio
6. Efficiency Ratios
- Mark-up vs. profitability: Harry Winston vs. Walmart
- Number of days' sales in inventory
- Average collection period
- Length of the operating cycle
- Fixed asset turnover and other utilization ratios
7. Leverage Ratios
- Singapore Airlines' low leverage
- Current ratio
- Leverage ratios
8. Potential Pitfalls to Ratio Analysis
- Historical data pitfalls and baseball
- Excess data and comparability issues
- Smoking gun and historical data biases