Fundamental Analysis & Valuation
2 terms
Altman Z-Score
Fundamental Analysis & Valuation
ratio (x, times)
A weighted combination of five financial ratios that estimates a company's likelihood of financial distress.
Z = 1.2 x (Working Capital/Total Assets) + 1.4 x (Retained Earnings/Total Assets) + 3.3 x (EBIT/Total Assets) + 0.6 x (Market Value of Equity/Total Liabilities) + 1.0 x (Sales/Total Assets)
Asset Turnover Ratio
Fundamental Analysis & Valuation
ratio (x, times)
Revenue divided by total assets, measuring how much sales the asset base generates.
Asset Turnover = Revenue / Average Total Assets