Financial Ratio Analysis Scorecard

Comprehensive assessment of company performance across liquidity, solvency, profitability, efficiency, and market metrics

Exceeds Benchmark Meets Benchmark Below Benchmark
Category Ratio Name Formula Benchmark Score Remarks
Liquidity Current Ratio Current Assets / Current Liabilities >1.5 4.5 Measures short-term solvency
Quick Ratio (Cash + Mkt. Sec. + Rec.) / Curr. Liabilities >1.0 3.0 Excludes inventory
Cash Ratio (Cash + Mkt. Sec.) / Current Liabilities >0.5 2.0 Strict liquidity assessment
Solvency Debt-to-Equity Total Debt / Total Equity <1.0 (industry-varies) 4.0 Capital structure health
Interest Coverage EBIT / Interest Expense >3.0 4.8 Debt servicing capacity
Debt-to-Assets Total Debt / Total Assets <0.6 3.5 Asset financing via debt
Profitability Gross Profit Margin (Revenue - COGS) / Revenue Industry-specific 4.2 Core production efficiency
Net Profit Margin Net Income / Revenue Industry-specific 3.2 Overall profitability
Return on Assets (ROA) Net Income / Total Assets >5% 4.7 Asset utilization efficiency
Return on Equity (ROE) Net Income / Shareholder's Equity >15% 2.8 Owner's investment return
Efficiency Inventory Turnover COGS / Average Inventory Industry-specific 4.3 Inventory management
Receivables Turnover Net Credit Sales / Avg. Acc. Receivable Higher = better 3.6 Collection efficiency
Asset Turnover Revenue / Total Assets >0.5 4.1 Asset productivity
Market Price-to-Earnings (P/E) Share Price / EPS Industry-comparison 2.5 Valuation relative to earnings
Dividend Yield Annual Div. per Share / Share Price Market-dependent 4.4 Income return to shareholders
Price-to-Book (P/B) Market Cap / Book Value of Equity <3.0 3.3 Asset-based valuation

Usage Guidelines

Scoring System

  • • 5 = Excellent (Significantly exceeds benchmark)
  • • 4 = Good (Exceeds benchmark)
  • • 3 = Satisfactory (Meets benchmark)
  • • 2 = Needs Improvement (Below benchmark)
  • • 1 = Critical Risk (Significantly below benchmark)

Key Analysis Areas

  • Liquidity: Short-term payment ability
  • Solvency: Long-term debt management
  • Profitability: Revenue conversion to profit
  • Efficiency: Resource utilization
  • Market: Investor perception

Customization & Notes

Implementation Tips

  • Adjust benchmarks based on industry specifics
  • Analyze trends quarterly and annually
  • Combine with DuPont Analysis for deeper insights
  • Use Altman Z-Score for bankruptcy risk assessment

Important Note

Ratios must be analyzed holistically – no single ratio determines financial health. Always consider industry context and economic conditions.

Overall Financial Health Score

Composite assessment based on all ratio categories

Financial Health 3.7 / 5.0

Strengths: Strong solvency position, good efficiency metrics

Areas for Improvement: Market valuation ratios, cash liquidity