The debt-to-equity (D/E) ratio is a financial metric that measures a company's financial leverage by comparing its total debt to shareholders' equity. It indicates how much debt a company uses to ...

The Treynor ratio is a tool in portfolio analysis that helps investors assess how well a portfolio compensates them for taking on market risk, also known as systematic risk. This portfolio ratio shows ...

Will Kenton is an expert on the economy and investing laws and regulations. He previously held senior editorial roles at Investopedia and Kapitall Wire and holds a MA in Economics from The New School ...

A business must possess enough funds to pay current financial obligations at all times to ensure continuity of business operations. Fixed-assets-to-net-worth ratio is an accounting tool that shows you ...

When you invest in a stock, oftentimes you expect to earn income by receiving dividends. And knowing how much of a company’s earnings it pays out as dividends can tell you a lot about that firm. Enter ...

Analysts use a variety of metrics to measure the effectiveness of sales activities. Companies use the data these metrics generate to evaluate profits, market share and other factors that determine a ...

Interest coverage ratio is a measure that assesses a company's ability to manage the cost of its debt. Both investors and bank lenders use the interest coverage ratio to assess a company's financial ...

The current ratio is calculated by dividing a company’s current assets by its current liabilities. Ratios of 1 or higher indicate short-term solvency. Because the current ratio compares short-term ...

Investopedia contributors come from a range of backgrounds, and over 25 years there have been thousands of expert writers and editors who have contributed. Thomas J. Brock is a CFA and CPA with more ...

Enterprise value is a common calculation of a company's worth that is more comprehensive than market capitalization. Enterprise value includes a company's debt, thus giving a fuller picture of a ...

Understanding the compa ratio is essential for evaluating employee compensation. This metric helps ensure salaries are competitive and fair within the market. The MarketWatch Guides team has provided ...