How do you attract investors with ratios when the normal public does not know anything about ratios? What are ways to illustrate these ratios?
One may attract investors with ratios when the normal public does not know anything about ratios if profitability and valuation is the focus or selling point. In fact, Investopedia.com (n.d.) references that, "Profitability is a key piece of information that should be analyzed when one is considering investing in a company. This is because high revenues alone don't necessarily translate into dividends for investors (or increased stock prices, for that matter) unless a company is able to clear all of its expenses and costs.
There are a large variety of ratios out there, but financial ratios can be broken up into four major categories: profitability ratios, liquidity ratios, solvency ratios and valuation ratios.
* PROFITABILITY ratios are used to give us an idea of how likely it is that a company will turn a profit, as well as how that profit relates to other important information about the company. If a company has a ...
The solution discusses public investing ratios.