Finance Glossary — Plain-English Definitions | Fisclear

Valuation

P/E RatioP/E

How much investors pay for each dollar of a company's earnings.

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PEG Ratio

P/E adjusted for how fast earnings are actually growing.

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P/B RatioP/B

Share price compared to a company's net asset value.

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P/S RatioP/S

Share price compared to revenue — useful when there's no profit yet.

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EV/EBITDA

A capital-structure-neutral way to compare valuations.

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Market Cap

The total market value of a company's shares.

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Profitability

Gross Margin

What's left of revenue after the direct cost of producing it.

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Net Margin

What's actually left for shareholders after every cost.

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Operating Margin

Profit from core operations, before interest and tax.

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Return on EquityROE

How efficiently a company turns shareholders' capital into profit.

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Free Cash Flow MarginFCF Margin

The cash a business actually generates, after reinvesting in itself.

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Risk & Leverage

Beta

How much a stock swings relative to the overall market.

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Debt-to-EquityD/E

How much of the company is financed by debt versus owners' capital.

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Current Ratio

Whether a company can cover its bills due within a year.

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Income

Dividend Yield

The cash return to shareholders, before any price appreciation.

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