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Reading a Company’s Numbers
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By the end of this module, you’ll be able to:
- Work out a company’s margins from its income statement.
- Find when a company’s debt comes due.
- Work out interest coverage and explain how much room operating profit provided that year.
- Explain what return on equity measures.
- Explain why return on equity and return on invested capital can differ.
- Say what each of these numbers cannot tell you.
5 lessons · about 30 minutes
- 1How much of each sale a company keeps: profit margins
- 2When a company’s debt has to be repaid
- 3Whether it can comfortably pay its interest
- 4What it earns on the owners’ money: return on equity
- 5What it earns on all the money invested: return on invested capital, then Reading a Company’s Numbers in one page + a quick check
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