Instruction: Calculate the expected rate of return and standard deviation for portfolio stock investment. Use this statistics calculator of expected return and standard deviation by entering the values in columns of probability and return of a stock.
Instructions: Use this calculator to find the Yield to Maturity or YTM by entering values of coupon payment (PMT), present value (PV), and future value (FV) of a stock. Please input the desire values in the form below:
Define yield to maturity of a bond/security
Yield to Maturity or YTM is key ratio of fixed-income bond or security in terms of rate of return earned over the total period. YTM also known as interest rate to be received on a bond when a holder bought it and retained it till maturity.
Theoretical formula to calculate the YTM (Yield to Maturity)
P = bond / security purchase price
C = Periodical payment of the coupon
F = face value of a bond
N = Maturity or number of times to maturity
Instructions: Use this calculator to find the OPM, GPM, and NPM of a company. Please input the desire values in the form below:
Following are key definitions of OPM, GPM, and NPM.
Definition of gross profit margin (GPM) finance
Gross profit margin (GPM) is calculated as gross profit divided by the revenue. This means how much a firm has earned revenue after deducting the cost of goods sold (COGS). Higher the GPM means more profitability than the lower gross profit margin.
When a company has a competitive advantage in terms of price, product quality, and cost which means each item sold will return more. Thus, this will increase the firm ability to generate more profitability.
Definition of operating profit margin (OPM) finance
OPM operating profit margin is calculated as operating profit divided by revenue. Higher the OPM means more profitability than the lower operating profit margin. The operating profit is measured by subtracting all operating expenses from the gross profit amount.
Definition of net profit margin (NPM) finance
Net profit is the remaining amount after subtracting all the operating expenses, interest, and taxes which illustrates the remaining amount left in the revenue in a given period. To calculate the net profit margin (NPM); the value of net income is divided by the revenue.
Profitability ratios are measured by using a firm’s profit and loss account or income statement. These are key ratios used to evaluate the firm profitability such as net profit margin (NPM); operating profit margin (OPM) and gross profit margin (GPM). This provides the basic financial analysis of the firm’s ability to turn its sales into profitability.
Instructions: Use this calculator to measure the return on assets (ROA) and return on equity (ROE). Please input the desire values in the form below:
Definition Return on Assets (ROA)
ROA stands for return on assets is essential ratio used to calculate the firm’s ability to generate profit by utilizing its assets.
Higher the value of return on assets shows better performance of firms. This improves effectiveness which contrasts with lower ROA.
Thus, this is also a positive indication for existing shareholders and new investors to capitalize more finance into the firm stock.
Definition Return on Equity (ROE)
Return on equity is calculated; net profit divided by total shareholder’s equity. ROE is an efficiency ratio that recognizes a firm’s ability to generate profit on shareholders’ capital retained by a corporation.
Higher the value of return on equity shows better performance of the firm, increasing the value return for equity shareholders.
However, lower ROE means less performance of firms, decreasing the return value for equity share investors.
Instructions: Use this calculator to find the liquidity ratio such as current ratio, quick ratio and working capital ratio analysis of a company. Please input the desire values in the form below:
Definition of liquidity in business
The liquidity ratio is an important measurement of firm performance. This is used to calculate the time required to turn their assets back into cash. The liquidity ratio signifies the firm’s capability to pay its short-term liabilities which are due in one financial year.
The main liquidity ratios are the current ratio and quick ratio.
Firm capability to payout its short-term liabilities includes a current portion of long-term loans, accounts payable and others.
It is calculated as current assets divided by current liabilities.
Current ratio = 1; means current assets equal to current liabilities
Current ratio < 1; means current assets less than current liabilities
Current ratio > 1; means current assets greater than current liabilities
Higher the value of the current ratio means the firm has sufficient capability to timely payout its short-term financial obligations which contrast with lower current ratio.
Quick ratio is also liquidity ratio which calculated as current assets less inventories divided by current liabilities. The higher in the value of quick ratio shows high firm liquidity to payout its short term liability.
The main difference between current ratio and quick ratio is that quick ratio excludes value of inventories.