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Average corrected P/E ratio * net profit at the end of the forecast period. Example: VirusControl is expecting a net profit at the end of the fifth year of about €2.2 million. They use the following calculation to determine their future value: ((17.95 + 21.7 + 20.8) / 3) * 2,200,000 = €44.3 million
[2] Liquidity ratios measure the availability of cash to pay debt. [3] Efficiency (activity) ratios measure how quickly a firm converts non-cash assets to cash assets. [4] Debt ratios measure the firm's ability to repay long-term debt. [5] Market ratios measure investor response to owning a company's stock and also the cost of issuing stock. [6]
where s x 2 and s y 2 are the variances of the x and y variates respectively, m x and m y are the means of the x and y variates respectively and s xy is the covariance of x and y. Although the approximate variance estimator of the ratio given below is biased, if the sample size is large, the bias in this estimator is negligible.
[124] [125] It is especially important to exactly determine the structure of the sample (and specifically the size of the subgroups) when subgroup analyses will be performed during the main analysis phase. [126] The characteristics of the data sample can be assessed by looking at: Basic statistics of important variables; Scatter plots
Formal estimation model: The quantification step is based on mechanical processes, e.g., the use of a formula derived from historical data. Combination-based estimation: The quantification step is based on a judgmental and mechanical combination of estimates from different sources. Below are examples of estimation approaches within each category.
A ratio distribution (also known as a quotient distribution) is a probability distribution constructed as the distribution of the ratio of random variables having two other known distributions. Given two (usually independent ) random variables X and Y , the distribution of the random variable Z that is formed as the ratio Z = X / Y is a ratio ...
The return on equity (ROE) is a measure of the profitability of a business in relation to its equity; [1] where: . ROE = Net Income / Average Shareholders' Equity [1] Thus, ROE is equal to a fiscal year's net income (after preferred stock dividends, before common stock dividends), divided by total equity (excluding preferred shares), expressed as a percentage.
The sample odds ratio n 11 n 00 / n 10 n 01 is easy to calculate, and for moderate and large samples performs well as an estimator of the population odds ratio. When one or more of the cells in the contingency table can have a small value, the sample odds ratio can be biased and exhibit high variance .