PE Ratio – is it under/over valuation?

WHAT IS THE PRICE TO EARNINGS RATIO? The Price to Earnings Ratio is the financial metric that helps in comparing the price of the company’s stock to the net earnings

Income Statement – Did you turn green this time?

WHAT IS AN INCOME STATEMENT?  A company’s financial performance over any specific accounting period is reported using three most important financial statements: The Balance Sheet, the Income Statement and the

Liquidity Ratios – Its all about cash

An investor or a financial analyst calculates varies ratios using the income statement and balance sheet of the company to analyze the performance and profitability of the company. Some of

EBITDA is not the same as Cash Flows

WHAT IS EBITDA? The term EBITDA stands for Earnings(E) before(B) Interest(I), Taxes(T), Depreciation(D) and Amortization(A). At many places we may see EBITDA categorized as one of the profitability financial ratios,

CAPM – can you really price the risk in equity markets?

WHAT IS CAPITAL ASSET PRICING MODEL (CAPM)? Capital Asset Pricing Model is one of the financial models used by the corporate finance professionals and Investment Bankers to establish and understand

CAGR – how does compounding even work?

What is Compound Annual Growth Rate (CAGR)? Compound Annual Growth Rate is commonly referred to as CAGR in the business or industry. It is the measure of the annual growth

Depreciation Expense – non cash but is it important?

MEANING OF DEPRECIAITON EXPENSE Every business needs certain fixed assets like Building, vehicles, plant and machinery, Laptops etc. to carry out its operations smoothly and to be more productive. Every

Goodwill in accounting – blessing or a curse?

UNDERSTANDING GOODWILL IN SIMPLER TERMS Have you wondered what is goodwill in accounting? Let’s explain here in detail. We often read about various acquisitions, mergers, or corporate sales in the