If you are following financial news channels, websites and research reports, then by now, you must have heard about the term CAGR. In case till now, you are not able to figure out what is the CAGR and how compound annual growth rate is calculated, then this article might be a great help. CAGR stands for the Compound Annual Growth Rate. Compound Annual Growth Rate (CAGR) … [Read more...] about CAGR: How to calculate Compound Annual Growth Rate
Finance
Operating Profit: Definition, Formula and Use
Profit is vital for monitoring a company's performance as it represents positive net cash flow to the business. In business, profits, earnings and incomes are used interchangeably. It's the amount that is left over after accounting all the expenses against revenue. We have different types of profits calculated based on how expenses are incurred by the company. One of such … [Read more...] about Operating Profit: Definition, Formula and Use
EBITDA: What it is and how it’s calculated
EBITDA is an acronym for Earnings Before Interest, Taxes, Depreciation, and Amortization. While conducting financial analysis, the EBITDA to sales ratio is used as a financial metric to know the company's operational efficiency. EBITDA margin is calculated by dividing earnings before interest, tax, depreciation and amortization by total sales. It's used as a … [Read more...] about EBITDA: What it is and how it’s calculated
What is profit after tax (PAT) and how is it calculated
PAT stands for Profit After Tax. One of the main objectives of a company is to increase shareholders wealth. It will increase only when the company earns money from its business. More money means more wealth. Due to this reason a company prepares periodical income statement to present before the shareholders. Income statement shows how efficiently the management has … [Read more...] about What is profit after tax (PAT) and how is it calculated
10 key financial metrics used by value investors to pick stocks
Key financial metrics can be helpful while finding long term investing opportunities in the stock market. One of the main objectives of a value investor is to pick a stock that they believe is undervalued. They use different financial metrics to analyse a company's fundamentals and valuation. One of the most well-known value investors Mr Warren Buffett uses … [Read more...] about 10 key financial metrics used by value investors to pick stocks
Return on Assets (ROA): How to calculate and use in financial analysis
Return on assets, popularly referred to as ROA, is a financial ratio that indicates profitability of a company in relation to its total assets for a period. Retrun on assets (ROA) shows how efficient the management is in generating profit by using the company's assets. In this article you will learn how to calculate return on assets (ROA) and how to interpret the ratio to … [Read more...] about Return on Assets (ROA): How to calculate and use in financial analysis
Understanding Volume Weighted Average Price (VWAP) for intraday trading
In technical analysis we have different indicators to measure the movement of price for trading. One of such indicators used along with price action is Volume Weighted Average Price (VWAP). Price action of a stock or any other financial security can be analysed by using candlestick charts and price patterns. VWAP can be used along with other indicators for intraday … [Read more...] about Understanding Volume Weighted Average Price (VWAP) for intraday trading
How the finance department helps businesses to grow
In almost all companies, the finance department has two most important jobs: Recording and reporting of financial transactions in a company's books of account is referred to as accounting, managed by the accounts department. Effective management of a company's resources is managed by a team within the finance department, in certain companies it's referred to … [Read more...] about How the finance department helps businesses to grow
Shrinkflation: What is it and why is it used by producers
Shrinkflation is a process of items shrinking in size or quantity, or even sometimes reformulating, while their prices of the product remain the same or slightly increase. It is a tactic used as an alternative to raising prices in line with market inflation. Shrinkflation is also known as package downsizing. This means your everyday products shrink in size and quantity … [Read more...] about Shrinkflation: What is it and why is it used by producers
What are CPI and WPI inflation rates in economics
Government releases data related to consumer price index (CPI) and wholesale price index (WPI) of the country. WPI and CPI are the most commonly used measures to determine inflation. Inflation is a rate at which prices of goods and services are rising in an economy. Inflation is always expressed as a percentage. The main purpose of calculating consumer price index (CPI) … [Read more...] about What are CPI and WPI inflation rates in economics