Comparative Credit Analysis is a method of company evaluation in which a firm is compared with other similar firms that have a desired credit rating to decide on appropriate accounting ratio targets for the company being analyzed.
Cross-sectional analysis involves comparing the accounting ratios of one company with those of its peers to assess profitability, liquidity, and capital structure. This method helps in determining a company's performance relative to its competitors.
A ratio that measures the average number of days an organization's stock is held before it is sold or used in production.
Ratio analysis is the use of accounting ratios to evaluate a company's operating performance and financial stability. Examples include return on capital employed and gross profit percentage for profitability assessment. Additionally, the liquid ratio examines solvency, while gearing ratios evaluate the company's financial structure.
Tobin's Q Ratio, devised by US economic analyst James Tobin, measures the impact of intangible assets on business value by comparing the market value of a business to the replacement cost of its assets.
Trend analysis involves evaluating the performance of a company or industry over a period using accounting ratios to identify patterns and forecast future performance.
