Gross Margin is used to evaluate a company's core profitability and operational efficiency. It measures the percentage of revenue that remains after deducting the cost of goods sold (COGS), reflecting how efficiently a company produces or delivers its products and services.

• Gross Margin = Gross Profit / Revenue
• Gross Profit = Revenue – Cost of Goods Sold

Gross margin is crucial for assessing the strength of a company’s business model, pricing strategy, and cost structure. A consistently high gross margin may indicate strong competitive advantages, such as pricing power, efficient production, or low input costs. Conversely, a declining gross margin can signal rising production costs, pricing pressures, or inefficiencies, which may affect long-term profitability.

Operating Margin measures a company's operational efficiency and profitability from its core business activities, before considering the effects of interest and taxes. It indicates the proportion of revenue that remains after covering all operating expenses, including costs such as wages, rent, and administrative expenses, but excluding non-operating items like financing costs and tax liabilities. A higher operating margin suggests that a company is managing its costs effectively and generating strong profits from its core activities, which is often a sign of a solid and scalable business model.

• Operating Margin = Operating Income / Revenue
• Operating Income = Gross Profit - Operating Expenses

Operating margin is used to assess a company's financial health, cost management, and ability to generate value independently of external financing or tax strategies. It is particularly valuable for comparing companies within the same industry, as it isolates operational performance from capital structure differences.

Net Margin measures the percentage of revenue that remains as net income after all expenses have been deducted. This includes not only operating expenses, but also interest, taxes, depreciation, amortization, and any other non-operating items. It reflects the company’s overall ability to convert revenue into profit attributable to shareholders.

• • Net Margin = Net Income / Revenue
  • Net Income = Revenue - Total Expenses

Net margin provides a comprehensive view of a company’s financial performance, as it captures the cumulative effect of all aspects of the business — from operational efficiency and cost control to financing decisions and tax strategies. A higher net margin indicates strong overall profitability, while a declining or low net margin may signal underlying inefficiencies, rising costs, or unfavorable market conditions.

Operating Cash Flow Margin evaluates a company's ability to generate cash from its core operating activities relative to its revenue. It measures the efficiency with which a company converts its sales into actual cash, providing insight into the quality and sustainability of its earnings.

• Operating Cash Flow Margin = Operating Cash Flow / Revenue

Unlike earnings-based metrics, Operating Cash Flow Margin is derived from cash flow statements and reflects actual cash inflows, excluding non-cash accounting items such as depreciation or changes in working capital. This makes it a more reliable indicator of a company's liquidity, operational strength, and financial resilience, particularly during periods of economic uncertainty.

Free Cash Flow Margin measures the proportion of a company’s revenue that is converted into free cash flow—the cash remaining after covering all operating expenses and capital expenditures. It reflects the company’s ability to generate discretionary cash that can be used for debt repayment, dividends, share buybacks, or reinvestment in growth initiatives.

• Free Cash Flow Margin = Free Cash Flow / Revenue

Free Cash Flow is calculated by subtracting capital expenditures from operating cash flow. The resulting margin provides insight into a company’s financial flexibility, capital efficiency, and capacity to create long-term value. A strong and stable Free Cash Flow Margin indicates that the company is not only profitable but also efficiently converting its revenues into cash that can support strategic initiatives without relying heavily on external financing.

Return on Equity (ROE) assess a company’s ability to generate net income relative to the shareholders’ equity invested in the business. It reflects how effectively management is using equity capital to create value for shareholders and is often considered a key indicator of financial performance and capital efficiency.

• Return on Equity (ROE) = Net Income / Shareholders’ Equity ​

ROE provides insight into a company’s profitability, efficiency, and financial management. A consistently high ROE indicates that the company is generating strong returns on the capital provided by its shareholders, which may signal strong operational performance, competitive advantages, or effective capital allocation. Conversely, a declining or unusually low ROE could point to inefficiencies, declining profitability, or overcapitalization.

Return on Assets (ROA) is a fundamental financial metric that measures a company’s ability to generate net income from its total assets. It reflects how efficiently management is utilizing the company’s assets to produce profits and is a key indicator of operational effectiveness and asset productivity.

• Return on Assets (ROA) = Net Income / Total Assets

In fundamental analysis, ROA is used to assess how well a company is managing its asset base to drive profitability. A higher ROA indicates that the company is generating more income per unit of asset, which may suggest effective use of resources, strong operational performance, or a capital-light business model. Conversely, a low ROA could signal underutilized assets, inefficiencies, or excessive capital investment relative to earnings.

• Year-over-Year Growth (YoY) measures the percentage change in a metric compared to the same period in the previous year, highlighting annual performance trends.
• Quarterly Growth (Qtr) Year-over-Year (YoY) measures the year-over-year change in performance for a specific quarter, allowing  to compare the same period in the prior year. This comparison helps normalize for seasonality and provides insight into long-term trends or growth trajectories.
• Quarter-over-Quarter Growth (QoQ) is the percentage change in a metric from one quarter to the previous quarter, used to assess short-term performance trends.

Revenue Growth measures the rate at which a company’s sales or top-line income increases over a specific period, typically compared year-over-year or quarter-over-quarter. It is a primary indicator of a company’s market expansion, customer demand, and overall business momentum. Revenue growth is critical for evaluating the company’s ability to expand its operations, capture market share, and scale its business model. Sustained and consistent growth often reflects strong product-market fit, effective sales strategies, and competitive positioning. Conversely, slowing or negative revenue growth may signal weakening demand, increased competition, or operational challenges.

• Operating Income Growth measures the rate at which a company’s operating income increases over a specific period, typically on a quarterly or annual basis. It reflects the company's ability to expand its profitability from core operations, independent of financing or tax effects, and is a direct indicator of improvements in operational performance. This growth metric is particularly important in assessing whether a company is successfully scaling its business and improving efficiency. Positive and consistent operating income growth may indicate stronger revenue generation, effective cost management, or improved operating leverage. Conversely, declining operating income may signal rising costs, inefficiencies, or deteriorating market conditions.
• Net Income Growth measures the rate at which a company’s net income increases over a specific period, typically on a year-over-year or quarter-over-quarter basis. It reflects the company’s ability to expand its bottom-line profitability, taking into account all revenues and expenses, including operating costs, interest, taxes, and non-operating items. This metric is critical in assessing a company’s financial health, earnings power, and management effectiveness over time. Sustained net income growth often indicates a strong business model, operational efficiency, and disciplined financial management. It also supports long-term value creation through higher earnings per share, improved return metrics, and potential for dividend growth.

• Operating Cash Flow Growth is a critical metric in fundamental analysis that measures the rate at which a company’s cash generated from core operating activities increases over a specific period, typically on a quarterly or annual basis. It reflects the company’s ability to convert its revenues into actual cash, independent of non-cash accounting items such as depreciation and amortization. This metric is essential for evaluating a company’s underlying financial strength and earnings quality, as it focuses on real cash inflows generated from day-to-day operations. Unlike net income, which can be influenced by accounting policies or one-time items, operating cash flow provides a more reliable indication of a company’s ability to fund operations, reinvest in the business, service debt, and return capital to shareholders.
• Free Cash Flow Growth measures the rate at which a company’s free cash flow (FCF) increases over a specific period, typically on an annual or quarterly basis. Free cash flow represents the cash remaining after a company has covered its operating expenses and capital expenditures, and it is a key indicator of a company's financial flexibility and capacity to create long-term shareholder value. Free Cash Flow Growth reflects a company’s ability to generate increasing amounts of discretionary cash that can be used to reduce debt, pay dividends, repurchase shares, or reinvest in strategic initiatives. Sustained FCF growth typically indicates strong operational performance, disciplined capital expenditure management, and a scalable business model.

Book Value Growth measures the increase in a company’s book value—or shareholders’ equity—over a specific period, typically year-over-year. Book value represents the net asset value of a company, calculated as total assets minus total liabilities, and reflects the accumulated value attributable to shareholders. Book Value Growth indicates the company’s ability to retain earnings, manage assets efficiently, and build intrinsic value over time. It often results from profitable operations, reinvestment of earnings, and prudent financial management. A consistent increase in book value suggests that the company is effectively creating long-term value for its shareholders.

• Total Debt Growth measures the rate at which a company’s total debt liabilities—including both short-term and long-term borrowings—have increased over a defined period, typically on an annual or quarterly basis. It provides insight into how a company is financing its operations, investments, or expansion initiatives. Total Debt Growth is used to assess a company’s capital structure strategy, financial leverage, and risk profile. A moderate increase in debt may indicate strategic financing to support growth or capital investments. However, excessive or accelerating debt growth—especially without corresponding improvements in revenue, earnings, or cash flow—may signal rising financial risk, potential overleveraging, or declining credit quality.
• Total Assets Growth is a key indicator in fundamental analysis that measures the rate at which a company’s total asset base increases over a specified period, typically year-over-year. It reflects the company’s investment in resources such as cash, inventory, property, equipment, and intangible assets that are used to support revenue generation and future growth. This metric is used to assess a company’s expansion strategy, capital allocation, and growth trajectory. Growth in total assets can result from increased capital investment, acquisitions, or retained earnings being reinvested into the business. When supported by proportional growth in revenue and profitability, it may signal effective use of capital to drive business performance. However, if asset growth outpaces income growth, it may raise concerns about declining efficiency or overexpansion.

Debt to Asset ratio measures the proportion of a company's total liabilities financed by its total assets. This ratio provides insight into the company's financial leverage and risk by indicating how much of the asset base is funded through debt rather than equity. A higher ratio suggests greater reliance on debt financing, which may increase financial risk and affect solvency.

• Debt to Asset Ratio = Total Liabilities / Total Assets

Debt to Equity ratio measures the relative proportion of a company’s total debt to its shareholders’ equity. This ratio evaluates the company’s financial leverage by indicating how much debt is used to finance the company’s assets compared to equity. A higher debt to equity ratio suggests greater reliance on borrowed funds, which can increase financial risk but may also enhance returns on equity during profitable periods.

• Debt to Equity Ratio = Total Debt / Shareholders’ Equity

Long-Term Debt to Asset ratio measures the proportion of a company’s total assets that are financed by long-term debt. This metric provides insight into the company’s capital structure and financial leverage by indicating the extent to which long-term obligations support the asset base. A higher ratio suggests greater reliance on long-term borrowing, which may increase financial risk and affect the company’s solvency.

• Long-Term Debt to Asset Ratio = Long-Term Debt / Total Assets

Long-Term Debt to Equity ratio measures the proportion of a company’s long-term debt relative to its shareholders’ equity. This ratio provides insight into the company’s capital structure by highlighting the extent to which long-term financing is funded through debt versus equity. A higher ratio indicates greater leverage and potentially higher financial risk, as the company relies more heavily on long-term borrowing to finance its operations and growth.

• Long-Term Debt to Equity Ratio = Long-Term Debt / Shareholders’ Equity

In fundamental analysis, the Equity to Asset ratio measures the proportion of a company’s total assets that are financed by shareholders’ equity. This ratio provides insight into the company’s financial structure by indicating the degree to which assets are funded by owners’ capital rather than debt. A higher equity to asset ratio generally reflects lower financial risk and greater solvency.

• Equity to Asset Ratio = Shareholders’ Equity / Total Assets

Interest coverage ratio evaluates a company’s ability to meet its interest obligations on outstanding debt using its operating earnings. This metric assesses the company’s financial health and risk by indicating how comfortably earnings can cover interest expenses. A higher interest coverage ratio suggests stronger capacity to service debt, while a lower ratio may signal potential liquidity concerns.

• Interest Coverage Ratio = Operating Income / Net Interest Expense