Financial Ratios: Uses and Limitations
Premium
Financial Ratio Uses
- Valuing a company’s stock.
- Determining a company’s systemic risk (beta risk) exposure.
- Creating a company’s credit rating.
- Predict a company’s likelihood of financial distress (i.e. bankruptcy).
- Preparing pro forma financial statements that provide estimates of financial statements for future periods.
Financial Ratio Analysis Limitations
Unlock Premium Content
Upgrade your account to access the full article, downloads, and exercises.
You'll get access to:
- Access complete tutorials and examples
- Download source code and resources
- Follow along with practical exercises
- Get in-depth explanations