Key Metrics for Fundamental Analysis

Earnings per Share (EPS) 💰divides company profit per stock. A higher EPS generally means a company is more profitable.

Price to Earnings (P/E) Ratio 🏷️ compares a company's current stock price to its EPS.

It's often used for determining overvaluation or undervaluation!

Dividend Yield 💰 measures the amount of dividends paid out by a company per share.

A higher dividend yield generally means a company is more financially stable and profitable.

Return on Equity (ROE) 💹compares a company’s profit to its shareholder equity.

A higher ROE generally means a company is more efficient at generating profits with the money shareholders have invested.

Debt to Equity Ratio 🧾compares a company's total debt to its shareholder equity.

A higher ratio means a company has taken on more debt relative to its equity, which can be a sign of financial risk.

Current Ratio 💵 measures a company's ability to pay its short-term debts.

A higher current ratio generally means a company is more financially stable.

Free Cash Flow 💰 measures the amount of cash a company generates after accounting for capital expenditures.

A higher free cash flow generally means a company has more flexibility to invest in growth opportunities.

You’ve just learned 7 key metrics for fundamental analysis!

Feel free to come back to this lesson or click the info icon on each stat on Bloom if you ever need a refresher!