# ratio

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## Ratio

The division of one piece of financial information by another. Financial ratios are very common in fundamental analysis, which investigates the financial health of companies. An example of a financial ratio is the price-earnings ratio, which divides a publicly-traded company's share price by its earnings per share. This and other ratios help analysts determine whether a company's share price properly reflects its performance.

## ratio

The relation between two quantities when compared mathematically with one another. For example, the most frequently used ratio among investors is the price-earnings ratio. Financial analysts, investors, and managers use ratios to evaluate many factors such as the attractiveness of a stock or the operating efficiency of a company. Also called financial ratio. See also activity ratio, debt management ratio, liquidity ratio, profitability ratio.
References in periodicals archive ?
Taking into account the conformity between various definitions of parameters of loading regime, the deviation is expressed in the invariant form through the corresponding cross ratio for the variable [m.sub.1]:
For this purpose, we will consider the cross ratios for quantities (or variables) [m.sub.1] and [m.sub.2], using their conformity, according to transformation (8).
Since the cross ratio is invariant under projective transformations, it follows that [y.sub.j+2n](A) = [y.sub.j](A) for all j.

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