Tangible Book Value, Explained: What Your Company Is Worth After Stripping Goodwill and Intangibles
Tangible book value is shareholders' equity minus goodwill and intangibles — the liquidation floor banks still trade on, read via P/TBV.
#financial-ratios
Financial Ratios
Key financial ratios like ROA, ROE, and profitability metrics for measuring business performance
TVPI, DPI, and RVPI, Explained: The Three Money Multiples That Grade a Private Fund
TVPI always equals DPI plus RVPI: cash returned plus paper value over paid-in capital — but no multiple shows timing, so pair it with IRR.
The Graham Number, Explained: The Maximum Price Benjamin Graham Would Pay for a Stock
The Graham Number — the square root of 22.5 × EPS × BVPS — caps what a defensive investor pays: below it, research the stock; above it, pass.
The PEG Ratio, Explained: How Dividing P/E by Earnings Growth Separates a Fair Price From an Expensive One
PEG ratio divides P/E by earnings growth — around 1.0 is fairly valued, below 1.0 may be cheap if the growth is real.
Negative Working Capital, Explained: When Owing More Than You Own Is a Warning — or a Strategy
Negative working capital means current liabilities top current assets — a warning, unless prepayments or supplier terms fund you. Four questions tell which.
Owner Earnings, Explained: Buffett's Measure of What a Business Really Earns
Owner earnings equal reported earnings plus non-cash charges minus maintenance CapEx — the cash you could withdraw without shrinking the business.
Equity Multiple, Explained: How Total Distributions Over Invested Equity Measures a Deal's Absolute Return
Equity multiple is total cash distributions divided by total equity invested — 2.0x means you doubled your money, with no adjustment for time or fees.
Net Operating Income (NOI), Explained: How Rental Revenue Minus Operating Expenses Values a Property
NOI is rental revenue minus operating expenses, before financing, CapEx, and taxes. It sets price via the cap rate and loan size via DSCR.
The Operating Cycle, Explained: How DIO Plus DSO Measures the Days From Inventory to Cash
Operating cycle equals DIO plus DSO — days from stocked inventory to collected cash. Subtract DPO for the cash conversion cycle.
Authorized vs. Issued vs. Outstanding Shares: What Each Count Means for Your Valuation, Your EPS, and Your Vote
Outstanding shares equal issued shares minus treasury stock — the only count that sets market cap, EPS, dividends, and votes.
Contra Accounts, Explained: Why Your Lender Reads the Net Number, Not the Gross One
Contra accounts offset their parents without erasing them: lenders underwrite net receivables, net equipment value, and net sales — not gross.
Dividend Yield vs. Payout Ratio: What Each Formula Tells You, Why a Soaring Yield Can Signal a Cut, and Where Special Dividends Fit
Yield is dividends over price; payout ratio is dividends over earnings. A soaring yield with coverage above 100% usually means the price fell ahead of a cut.