Definitions of record
Metric definitions
One definition per metric, shared by every page on the site. Each entry states the formula, the SEC concepts it is computed from, how to compare it without fooling yourself, when it is deliberately not served, and what it cannot tell you.
Growth and scale
- Revenue - Total sales the company reported for the period, as filed with the SEC.
- Revenue growth - Change from the prior reported annual revenue period.
- Revenue 3y CAGR - Compound annual revenue growth over the last three fiscal years.
- Diluted EPS - Net income per weighted-average diluted share - earnings spread across every share that could exist if options and convertibles exercised.
Margins
- Gross margin - The share of revenue left after the direct cost of producing what was sold.
- Operating margin - Operating income divided by revenue for the same period - profitability of the core business before financing and taxes.
- Net margin - The share of revenue that remained as reported net income.
- FCF margin - The share of revenue converted into free cash flow.
Cash and conversion
- Free cash flow - Operating cash flow minus the absolute value of capital expenditures - cash generated after reinvestment in the asset base.
- FCF conversion - The share of operating cash flow left as free cash flow after reinvestment in the asset base.
- Cash conversion of earnings - How fully operating cash flow backs reported net income for the same period - the work line behind the cash-flow-backing screen.
- Cash returned - Dividends plus buybacks - the cash sent to shareholders in the period, gross of any issuance.
- Total payout / FCF - The share of free cash flow consumed by dividends and buybacks together.
- Dividend payout - The share of net income paid out as dividends.
Returns
- ROE - Net income relative to shareholders' equity - the return generated on book equity.
- ROA - Net income relative to total assets - the return generated on the whole asset base.
- ROIC - After-tax operating income relative to the capital invested in the business.
- ROCE - Operating income relative to capital employed (equity plus long-term debt), before tax.
- ROE (DuPont) - Return on equity decomposed into what drives it: profitability, asset efficiency and leverage.
- Asset turnover - Revenue generated per dollar of average assets - how hard the asset base works.
- Equity multiplier - Average assets relative to average equity - the balance-sheet leverage term of the DuPont decomposition.
- Tax burden - The share of derived pre-tax income kept after tax - the tax term of the extended DuPont decomposition.
- Interest burden - The share of derived operating profit left after interest - the financing-cost term of the extended DuPont decomposition.
Balance sheet and liquidity
- Debt / equity - Total debt relative to shareholders' equity at the same fiscal period end - a balance-sheet leverage read.
- Net debt - Gross debt minus cash and equivalents at the same period end - the debt load after the cash that could notionally repay it; negative means a net cash position.
- Current ratio - Current assets relative to current liabilities - ability to cover near-term obligations with near-term resources.
- Quick ratio - Current assets excluding inventory relative to current liabilities - a stricter near-term coverage read.
- Interest coverage - Operating income relative to interest expense - how many times operating profit covers the interest bill.
Earnings quality and risk screens
- Altman Z'' - A four-ratio balance-sheet stress score (Z'' book-value variant, Altman 1983) that sorts companies into distress, grey and safe zones.
- Piotroski F-score - A nine-test checklist of year-over-year fundamental improvements (profitability, leverage/liquidity, efficiency), scored 0-9.
- Beneish M-score - An eight-component statistical screen for earnings-manipulation risk based on year-over-year distortions in receivables, margins, accruals and asset quality.
- Sloan accruals - The share of earnings that came from accounting accruals rather than cash - high accruals have historically preceded weaker subsequent earnings.
- Cash-flow backing of earnings - How fully operating cash flow backs reported net income.
- Receivables vs revenue - How much faster receivables grew than revenue year over year - collections lagging sales or recognition running ahead of cash.
- Inventory vs revenue - How much faster inventory grew than revenue year over year - stock building ahead of sales.
Shares and dilution
- Share dilution - The growth rate of shares outstanding - how quickly existing holders' proportional ownership is shrinking from issuance.
- SBC / revenue - Stock-based compensation as a share of revenue - how much of the cost base is paid in equity rather than cash.
Descriptive and educational, not investment advice. Methodology and data lineage.