Financial Ratio Analysis Calculator
Financial ratio analysis is a critical tool for understanding a company’s financial health and performance. It helps investors, creditors, and management make informed decisions.
- Enter the relevant financial figures into the calculator.
- Click the ‘Calculate’ button.
- View and interpret the results.
We calculate the following ratios:
- Gross Profit Margin: (Revenue – Cost of Goods Sold) / Revenue
- Operating Profit Margin: Operating Income / Revenue
- Return on Assets (ROA): Net Income / Assets
- Return on Equity (ROE): Net Income / Equity
- Debt-to-Equity Ratio: Liabilities / Equity
| Ratio | Average | Median |
|---|---|---|
| Gross Profit Margin | 38.5% | 39.2% |
| Operating Profit Margin | 14.3% | 14.1% |
| ROA | 8.2% | 8.1% |
| ROE | 16.4% | 15.1% |
| Debt-to-Equity Ratio | 1.1 | 0.8 |
- Compare ratios with industry averages to benchmark performance.
- Track ratios over time to identify trends and make data-driven decisions.
- Consider both the absolute value of ratios and their trend over time.
What is a good gross profit margin?
A good gross profit margin varies by industry. As a general rule, higher is better.
For more information, see the Investopedia guide to financial ratios and the BLS guide to understanding financial statements.