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Financial Encyclopedia

Clear, plain-language explanations of the financial metrics and concepts used across Ticker Picker - from your very first share to reading a balance sheet.

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Learn the basics, one short article at a time

57 short articles in 7 parts. Your progress is saved as you read.

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Categories

Getting started

What a share is, how the stock market works, how to open an account and place your first order.

11 articles →

Analysing a stock

Read the financial statements, judge valuation, profitability, debt and growth, and understand the business behind the share.

9 articles →

Investment strategies

Growth, value, dividend, quality and momentum investing, index funds, monthly investing and compounding.

9 articles →

Risk and portfolio

Risk and return, diversification, volatility and beta, rebalancing, market declines and common mistakes.

6 articles →

Macroeconomics

Inflation, interest rates and central banks, the business cycle, currencies - and the eleven stock market sectors.

15 articles →

News and market sentiment

How to read financial news, what bias and factuality ratings mean, the news cycle score and earnings season.

4 articles →

Tax and practicalities

General principles of how investments are taxed, dividend withholding tax and keeping records. Not tax advice.

3 articles →

Glossary A-Z

Short, plain-English explanations of every term used in the screener and on the stock pages.

208 terms →

All articles

Getting started

  • What is a share? A share, also called a stock, is a small piece of ownership in a company. When you buy one, you become a part-owner and take part in the fortunes of the business.
  • How a stock exchange works The stock market is where shares in companies are bought and sold. It brings buyers and sellers together and sets a price for each company based on what people are willing to pay.
  • Stocks vs. ETFs and funds A fund pools money from many investors and spreads it across a large number of holdings. It lets you own a slice of hundreds or thousands of companies at once, without buying each one yourself.
  • Asset classes An asset class is a broad category of investment that behaves in a similar way. Knowing the main types helps you understand what you own and how a portfolio is put together.
  • Your first steps Before putting money into investments, it is wise to have a stable financial base. Investing works best when you are not forced to sell at the wrong time to cover an emergency.
  • Time horizon and risk tolerance Your time horizon is how long you expect to leave your money invested before you need it. It is one of the most important factors in deciding how to invest.
  • Fees and costs Every charge you pay to invest is taken from your returns. Small percentages may look harmless, but over many years they can consume a large share of your gains.
  • Avoiding scams and unrealistic returns Investment scams often succeed by promising high returns with little or no risk. Learning to spot the warning signs protects both your money and your peace of mind.
  • How to open a brokerage account To buy shares you need an account with a broker - a bank or an online platform that sends your orders to the stock exchange and keeps your shares safe.
  • Order types: market, limit and stop orders A market order buys or sells right away at the best available price; a limit order only trades at your price or better; a stop order triggers when the price reaches a level you set.
  • How to use a stock screener A stock screener filters thousands of listed companies down to the few that match numbers you choose, such as growth, dividend yield or valuation.

Analysing a stock

  • The three financial statements Behind every share is a real business, and its financial statements show how healthy that business is. Learning to read a few key figures helps you judge a company rather than just its share price.
  • Price is not the same as value The price of a share is what you pay for it today. Its value is what it is actually worth based on the underlying business. The two are related but often differ, and telling them apart is at the heart of investing.
  • How to analyse valuation: P/E, P/B, EV/EBITDA and PEG Valuation ratios compare a company's share price or total value with what it earns or owns, so companies of different sizes can be compared.
  • Profitability: margins, ROE and ROIC Profitability ratios show how much of each unit of sales a company keeps as profit and how well it uses the money invested in it.
  • Debt and financial strength Financial strength is a company's ability to pay its debts and survive bad years; debt ratios and cash show how much room it has.
  • Growth: revenue, earnings and dividends Growth metrics show how fast a company's sales, profit and dividends are increasing - and whether that growth is steady or a one-off.
  • Cash flow and free cash flow Cash flow shows the money that actually moves in and out of a company; free cash flow is what is left after the investments needed to keep the business running.
  • Dividends and payout ratio A dividend is part of the profit that a company pays out to its shareholders, usually in cash. It is one of the two main ways shares can reward you, alongside a rising price.
  • Understanding the business Doing your own research means understanding an investment before you commit money to it, rather than acting on a tip or a headline. It is one of the most important habits an investor can build.

Investment strategies

  • Growth and value investing Growth and value are two of the best known approaches to choosing shares. They describe different kinds of company an investor might favour, and many people blend the two.
  • Growth investing Growth investing looks for companies whose sales and earnings grow much faster than the economy, accepting a higher price for that growth.
  • Value investing Value investing looks for shares priced below what the business is worth, often companies that are out of favour.
  • Dividend investing Dividend investing focuses on companies that pay out part of their profit to shareholders regularly, for income and stability.
  • Quality investing Quality investing looks for companies with high, stable returns on capital, strong balance sheets and steady earnings.
  • Momentum investing Momentum investing buys shares that have risen strongly recently, betting that the trend continues for a while.
  • Index (passive) investing Active and passive describe two broad ways to invest. One tries to beat the market by picking investments, while the other simply tries to match it at very low cost.
  • Monthly investing (dollar-cost averaging) Dollar-cost averaging means investing a fixed amount at regular intervals, rather than trying to time a single large purchase. It is a simple way to build a position steadily.
  • The power of compounding Compounding is the process by which your returns begin to earn returns of their own. Given enough time, it can turn modest, regular investments into a substantial sum.

Risk and portfolio

  • Risk and return Every investment balances the chance of gain against the chance of loss. As a general rule, the higher the potential return, the greater the risk you must accept to earn it.
  • Diversification Diversification means spreading your money across many investments so that no single one can sink your whole portfolio. It is often summed up as not putting all your eggs in one basket.
  • Volatility and beta Volatility measures how much a share price swings; beta compares those swings with the market as a whole.
  • Allocation and rebalancing Rebalancing means occasionally adjusting your investments back to the mix you originally chose. It keeps your level of risk from drifting over time as different holdings grow at different rates.
  • Psychology and common mistakes Some of the biggest mistakes investors make are emotional rather than analytical. Learning to manage fear and greed is as important as understanding any single metric.
  • Market declines and drawdowns A bull market is a sustained period of rising prices, and a bear market is a sustained period of falling prices. Markets move through both, and neither lasts forever.

Macroeconomics

  • Inflation and purchasing power Inflation is the gradual rise in prices over time, which slowly reduces what each unit of your money can buy. It is a key reason people invest rather than simply hold cash.
  • Interest rates and central banks Central banks set short-term interest rates to keep inflation in check; rates affect borrowing costs, company profits and how investors value shares.
  • GDP and the business cycle GDP measures the size of an economy; the business cycle is the recurring pattern of expansion and recession that affects company profits.
  • Currencies and your investments When you own shares priced in another currency, changes in the exchange rate change your return - up or down.
  • Communication Services The Communication Services sector includes telecommunications, media, entertainment, and interactive media companies. It covers wireless and wireline telecom providers, cable operators, film and TV production, advertising agencies, and social media platforms. The sector is transforming through advancements like streaming services, 5G networks, and digital content consumption. Examples include Verizon (telecom), Disney (entertainment), and Meta Platforms (social media).
  • Consumer Discretionary The Consumer Discretionary sector includes companies providing non-essential goods and services purchased with disposable income, such as automobiles, apparel, leisure products, hotels, restaurants, and retail (including e-commerce). It covers durable goods like vehicles and appliances, as well as media and entertainment. The sector is closely tied to consumer confidence, spending trends, and economic prosperity. Examples include Amazon (e-commerce), Tesla (automobiles), and Nike (apparel).
  • Consumer Staples The Consumer Staples sector encompasses companies producing essential everyday goods like food, beverages, household products, personal care items, and tobacco. It includes manufacturers, distributors, and retailers of non-discretionary items such as groceries and hygiene essentials. The sector is renowned for its stability, driven by inelastic demand, strong brand loyalty, and consistent sales volumes. Examples include Procter & Gamble (household products), Coca-Cola (beverages), and Walmart (with overlaps in retail staples).
  • Energy The Energy sector comprises companies involved in the exploration, production, refining, marketing, and storage of energy sources, primarily oil, natural gas, and coal, with increasing integration of renewables like biofuels and alternative energies. It spans upstream (exploration and production), midstream (pipelines and storage), downstream (refining and marketing), and integrated majors. The sector is highly capital-intensive, driven by global energy demand, and increasingly oriented toward sustainability amid the ongoing energy transition. Examples include ExxonMobil (integrated oil) and Chevron (exploration and production).
  • Financials The Financials sector includes banks, insurance companies, investment firms, credit services, and diversified financials such as asset managers and stock exchanges. It encompasses commercial banking, investment banking, brokerage services, insurance (life, property, casualty), and consumer finance. The sector plays a critical role in capital allocation, risk management, and facilitating economic transactions, with strong influences from interest rates and credit cycles. Examples include JPMorgan Chase (banking), Berkshire Hathaway (insurance and investments), and Visa (payments).
  • Health Care The Health Care sector includes companies providing medical services, equipment, pharmaceuticals, biotechnology, and health insurance. It encompasses drug manufacturers, biotech firms, hospitals, medical device makers, and managed care providers. The sector is propelled by innovation, aging populations, and rising healthcare expenditures, with substantial R&D investments and stringent regulatory oversight from agencies like the FDA. It demonstrates relative resilience to economic downturns due to the inelastic demand for health-related products and services. Examples include Pfizer (pharmaceuticals), Johnson & Johnson (diversified health), and UnitedHealth Group (insurance).
  • Industrials The Industrials sector covers a broad array of companies engaged in manufacturing, engineering, and services that support industrial activities. This includes aerospace and defense, machinery, electrical equipment, construction and engineering, industrial conglomerates, railroads, airlines, and logistics firms. It is a diverse group focused on producing capital goods, transportation solutions, and professional services for businesses. The sector benefits from infrastructure spending, global trade expansion, and technological advancements like automation and electrification. Examples include Boeing (aerospace), Caterpillar (machinery), and United Parcel Service (logistics).
  • Information Technology The Information Technology sector covers companies developing and distributing technology products and services, including software, hardware, semiconductors, IT consulting, and internet infrastructure. It includes areas like cloud computing, cybersecurity, data analytics, and electronics manufacturing. The sector is driven by rapid innovation, digital transformation, and trends such as AI and enhanced connectivity. Examples include Apple (hardware and software), Microsoft (software and cloud), and NVIDIA (semiconductors).
  • Materials The Materials sector encompasses companies involved in the discovery, development, and processing of raw materials essential for various industries. This includes businesses in chemicals, metals and mining, paper and forest products, containers and packaging, and construction materials. These companies extract, refine, or manufacture basic commodities such as steel, aluminum, chemicals, fertilizers, cement, and lumber. The sector is deeply intertwined with global supply chains and industrial production, often acting as upstream suppliers to manufacturing and construction activities. Key characteristics include high capital intensity, strong sensitivity to commodity prices, and significant exposure to environmental regulations stemming from the resource-extractive nature of many operations. Examples of companies in this sector include Dow Inc. (chemicals), Newmont Corporation (mining), and International Paper (packaging).
  • Real Estate The Real Estate sector comprises companies owning, developing, and managing properties, including real estate investment trusts (REITs) focused on commercial, residential, industrial, or specialized assets like data centers. It excludes mortgage-related financials and generates income from rents, property sales, and management fees, influenced by factors such as location, occupancy rates, and market valuations. Examples include Prologis (industrial REIT) and Simon Property Group (retail malls).
  • Utilities The Utilities sector includes companies that provide essential services such as electricity, natural gas, water, and sewage to residential, commercial, and industrial customers. This sector is dominated by regulated monopolies or quasi-monopolies, with operations spanning power generation (from sources like coal, nuclear, renewables, or gas), transmission, distribution, and sometimes multi-utility services. It is characterized by stable, predictable revenues due to government oversight on pricing and returns, high infrastructure investments, and a strong emphasis on reliability and safety. The ongoing shift toward renewable energy and grid modernization represents a key evolving trend. Examples include NextEra Energy (renewables and electricity) and Duke Energy (multi-utility provider).

News and market sentiment

  • How to read financial news Separate facts from opinions, check the source, and ask whether the news changes the long-term value of the business or just today's price.
  • Bias and factuality ratings Every news article gets three labels: its political lean, whether it is for or against the company, and how factual it is - judged by an AI that reads the article.
  • News cycle score The news cycle score summarises a day's news about a company (or the whole market) on a scale from -100 (very negative) to +100 (very positive).
  • Earnings season and company reports Listed companies publish results every quarter or half-year; share prices often move most around these reports.

Tax and practicalities

  • Tax basics for investors Most countries tax gains when you sell shares at a profit and tax dividends when they are paid, but the rules and rates differ a lot between countries.
  • Dividend tax and withholding tax Dividends from foreign companies are often taxed twice - first in the company's country (withholding tax), then at home - unless a tax treaty reduces it.
  • Keeping records of your investments Keep the date, price, quantity, currency and costs of every purchase and sale - you will need them for tax and to judge your own results.

Glossary terms

  • 1-year estimated return The projected total return from today's price over one year, implied by the value estimate.
  • 1-year value estimate A model-based estimate of the share's intrinsic value one year out, based on projected fundamentals.
  • 10-year estimated return The projected total return over ten years from today's price. Longer horizons carry more uncertainty.
  • 10-year value estimate A model-based estimate of the share's intrinsic value ten years out. Longer horizons carry more uncertainty.
  • 3-year estimated return The projected total return over three years from today's price.
  • 3-year value estimate A model-based estimate of the share's intrinsic value three years out.
  • 5-year estimated return The projected total return over five years from today's price.
  • 5-year value estimate A model-based estimate of the share's intrinsic value five years out.
  • 52-week range The lowest and highest price of the share over the last year.
  • Accounts payable Money the company owes its suppliers for goods and services it has received.
  • Accounts receivable Money customers owe the company for goods or services already delivered.
  • Accrued liabilities Costs the company has incurred but not yet paid or been billed for, such as wages and interest.
  • Accumulated other comprehensive income Gains and losses that have not passed through the income statement yet, such as currency translation and some investment changes.
  • Acquisitions Cash spent buying other companies or businesses.
  • Additional paid-in capital Money investors paid for new shares above their par value.
  • Altman Z-score A formula combining profit, debt and assets that estimates the risk of financial distress. Below about 1.8 is a warning zone.
  • Asset allocation How your money is split between shares, bonds, cash and other asset classes.
  • Asset turnover Revenue divided by total assets: how much sales the company generates per dollar of assets.
  • Assets to equity Total assets divided by shareholders' equity: how many dollars of assets each dollar of equity carries.
  • Bear market A fall of 20 % or more from a recent peak in a broad market index.
  • Beta How much a share price has moved compared with the whole market: 1 = like the market, above 1 = bigger swings, below 1 = calmer.
  • Bid and ask (spread) The bid is the highest price a buyer offers, the ask the lowest price a seller accepts; the gap between them is a hidden trading cost.
  • Bond A loan to a government or company that pays interest and is repaid at a set date.
  • Book value per share Shareholders' equity divided by the number of shares.
  • Broker A bank or platform that sends your orders to the stock exchange and keeps your shares in an account in your name.
  • Bull market A long period of generally rising share prices.
  • Business sector The broad industry a company belongs to, such as Specialty Retail or Real Estate Investment Trusts. Handy for comparing companies in the same line of business.
  • Buyback yield Money spent on buying back the company's own shares over the last year, as a percentage of its market value.
  • CAGR (compound annual growth rate) The steady yearly growth rate that would turn the starting value into the ending value over the period.
  • Capital expenditures (capex) Money spent on buildings, machines and other long-lived assets.
  • Capital expenditures growth The change in capital expenditures compared with the same period a year earlier.
  • Capital gain The profit when you sell an investment for more than you paid. Often taxed.
  • Capital leases (current) Finance (capital) lease payments for buildings, equipment and similar assets that fall due within a year.
  • Capital leases (non-current) Finance (capital) lease payments that fall due more than a year from now.
  • Cash and equivalents Cash in the bank and very short-term, easily sold investments.
  • Cash conversion cycle DSO + DIO - DPO: the number of days from paying suppliers until customers have paid.
  • Cash from financing Cash from or to lenders and shareholders: new loans, repayments, dividends and buybacks.
  • Cash from investing Cash spent on (or received from) investments such as equipment, acquisitions and securities.
  • Cash from operations The cash the day-to-day business brought in during the period.
  • Cash from operations growth The change in cash from operations compared with the same period a year earlier.
  • Cash paid for dividends The cash the company actually paid out as dividends during the period.
  • Cash per share Cash and short-term investments divided by the number of shares.
  • Cash ratio Cash and short-term investments divided by current liabilities: can the company pay its short-term bills with cash alone?
  • Change in deferred tax The difference between the tax expense booked in the income statement and the tax actually paid in cash.
  • Commission (brokerage fee) The fee a broker charges for each trade.
  • Common stock (par value) The nominal (par) value of the shares the company has issued.
  • Compounding Earning returns on earlier returns, so growth speeds up over time.
  • Cost of goods sold The direct cost of making or buying what the company sold.
  • Country The country where the company is registered or mainly listed.
  • Current assets Assets expected to turn into cash within a year, such as cash, receivables and inventory.
  • Current portion of long-term debt The part of the long-term loans and bonds that falls due within the next year.
  • Current ratio Current assets divided by current liabilities. Below 1 means short-term bills exceed short-term assets.
  • Daily change How much the share price has moved so far today, shown as a percentage of the previous close.
  • Days inventory outstanding (DIO) How many days, on average, goods stay in inventory before they are sold.
  • Days payable outstanding (DPO) How many days, on average, the company takes to pay its suppliers.
  • Days sales outstanding (DSO) How many days, on average, customers take to pay.
  • Debt to assets Total debt as a share of total assets.
  • Debt to equity Total debt divided by shareholders' equity: how much the company is financed by borrowing.
  • Deferred revenue (current) Money customers have paid in advance for goods or services the company will deliver within a year.
  • Deferred revenue (non-current) Advance payments for goods or services the company will deliver more than a year from now.
  • Depreciation and amortisation The yearly cost of wearing out buildings, machines and intangible assets, spread over their useful life. Not a cash cost.
  • Diversification Spreading money across many investments so one bad result does not sink the whole portfolio.
  • Dividend A cash payment a company makes to its shareholders out of its profits, usually quarterly, half-yearly or yearly.
  • Dividend growth How fast the dividend per share is increasing from year to year.
  • Dividend per share The total dividend paid on one share over the last four quarters.
  • Dividend yield The annual dividend per share as a percentage of the share price — the cash return from dividends at today's price.
  • Drawdown How far an investment has fallen from its previous peak.
  • Earnings date The date the company is expected to publish its next results.
  • Earnings growth How fast earnings per share are growing. Steady, positive EPS growth is generally a healthy sign.
  • Earnings per share The company's profit divided by its number of shares — the profit attributable to each share.
  • Earnings yield Earnings per share divided by the share price - the P/E turned upside down, shown as a percentage.
  • EBITDA Earnings before interest, taxes, depreciation and amortisation — operating profitability with financing and accounting effects stripped out.
  • EBITDA growth The change in EBITDA compared with the same period a year earlier.
  • Effective tax rate Income tax as a share of pretax income: the tax rate the company actually pays.
  • Emergency fund Savings kept in cash for unexpected expenses, so you never have to sell investments at a bad time.
  • Enterprise value (EV) Market value plus debt minus cash: roughly what it would cost to buy the whole business including its debt.
  • Equity to assets Shareholders' equity as a share of total assets.
  • ETF (exchange-traded fund) A fund that trades on the stock exchange like a share, usually tracking an index.
  • EV/EBIT Enterprise value divided by operating profit (EBIT).
  • EV/EBITDA Enterprise value divided by EBITDA. Compares companies with different amounts of debt more fairly than P/E.
  • EV/FCF Enterprise value divided by yearly free cash flow.
  • EV/Sales Enterprise value divided by yearly revenue.
  • Ex-dividend date The first trading day on which a buyer of the share no longer gets the next dividend.
  • Exchange rate The price of one currency in another. It changes the value of foreign investments in your own currency.
  • Expense ratio (fund fee) The yearly fee a fund charges, as a percentage of what you have invested.
  • Factuality rating How much of a news article is checkable fact rather than opinion, from very low to very high.
  • Foreign exchange effects The change in the value of cash held in foreign currencies caused by exchange rate moves.
  • Free cash flow (FCF) Cash from operations minus capital expenditures: the cash left to pay dividends, buy back shares or repay debt.
  • Free cash flow growth The change in free cash flow compared with the same period a year earlier.
  • Free cash flow margin Free cash flow as a percentage of revenue.
  • Free cash flow per share Free cash flow divided by the number of shares.
  • Free cash flow yield Free cash flow per share divided by the share price, as a percentage.
  • GDP (gross domestic product) The total value of goods and services an economy produces in a year.
  • Goodwill The part of an acquisition price above the value of the assets bought. It can be written down if the deal disappoints.
  • Gross margin Gross profit as a percentage of revenue: how much of each sale is left after the direct costs.
  • Gross profit Revenue minus the direct cost of the goods or services sold — what is left to cover everything else.
  • Gross profit growth How fast gross profit is growing from one period to the next.
  • Income tax The tax charged on the period's profit.
  • Index fund A low-cost fund that tracks a market index, such as the S&P 500, instead of picking shares.
  • Inflation The general rise in prices, which reduces what your money can buy.
  • Intangible assets Non-physical assets such as patents, brands, licences and customer lists, mostly from acquisitions.
  • Interest coverage Operating profit divided by interest costs: how many times the profit covers the interest.
  • Interest expense Interest the company pays on its loans and bonds during the period.
  • Interest income Interest the company earns on its cash, deposits and loans it has made.
  • Interest rate The price of borrowing money. Central banks set the short-term rate; markets set longer-term rates.
  • Intrinsic value An estimate of what a business is really worth, based on the cash it is expected to produce - not on today's price.
  • Inventories Goods, materials and products in progress that the company holds to sell.
  • Inventory turnover Cost of goods sold divided by inventory: how many times a year the inventory is sold and replaced.
  • Long-term debt Loans and bonds that fall due more than a year from now.
  • Long-term investments Investments the company intends to hold for more than a year, such as stakes in other companies or long bonds.
  • Margin of safety Buying only when the price is clearly below your estimate of value, to leave room for mistakes.
  • Market capitalisation The total market value of a company's shares (share price multiplied by shares outstanding). A quick gauge of company size.
  • Minority interest The part of the equity in subsidiaries that belongs to outside owners.
  • Minority interest expense The share of the profit that belongs to outside owners of subsidiaries the company does not own 100 %.
  • Moving average The average price over a recent period (for example 50 or 200 days), used to show the trend.
  • Net change in cash How much the cash balance rose or fell during the period: operations + investing + financing + currency effects.
  • Net debt Total debt minus cash and short-term investments. Negative net debt means the company has more cash than debt.
  • Net debt to EBITDA Roughly how many years of EBITDA it would take to repay the net debt.
  • Net income The bottom-line profit that remains after all costs, interest and taxes.
  • Net income growth The change in net income compared with the same period a year earlier.
  • Net interest income Interest income minus interest expense.
  • Net issuance of common stock Cash received from issuing new shares minus cash spent buying shares back. Negative = net buybacks.
  • Net issuance of debt New borrowing minus loans repaid during the period. Positive = the company borrowed more.
  • Net issuance of preferred stock Cash received from issuing preferred shares minus preferred shares bought back or redeemed.
  • Net margin Net income as a percentage of revenue: how much of each sale ends up as profit.
  • News cycle score The day's news tone for a company or the market from -100 (very negative) to +100 (very positive), weighted by factuality and reach.
  • Operating income Profit from core operations after operating expenses, but before interest and tax.
  • Operating income growth The change in operating income compared with the same period a year earlier.
  • Operating income per share Operating income divided by the number of shares.
  • Operating margin Operating income as a percentage of revenue: what is left after running costs, before interest and tax.
  • Other current assets Short-term assets that do not fit elsewhere, such as prepaid expenses.
  • Other current liabilities Short-term obligations that do not fit elsewhere.
  • Other equity Equity items that do not fit elsewhere.
  • Other financing activities Financing cash flows that do not fit elsewhere, such as fees for raising capital.
  • Other investing activities Investing cash flows that do not fit elsewhere.
  • Other long-term assets Long-term assets that do not fit elsewhere, such as deferred tax assets or long-term prepayments.
  • Other long-term liabilities Long-term obligations that do not fit elsewhere, such as pensions or deferred taxes.
  • Other non-operating income Gains and losses outside the daily business, such as currency effects, investment results or the sale of assets.
  • Other operating activities Other non-cash items and adjustments between net income and cash from operations.
  • P/B (price to book) Share price divided by book value (equity) per share. Most useful for banks and asset-heavy companies.
  • P/FCF (price to free cash flow) Market value divided by yearly free cash flow - like P/E, but based on cash instead of accounting profit.
  • P/S (price to sales) Market value divided by yearly revenue. Used for companies without profits, but ignores how profitable the sales are.
  • Payout ratio The share of the company's profit that is paid out as dividends. Above 100 % means it pays out more than it earns.
  • PEG ratio The P/E divided by expected yearly earnings growth in percent. Around 1 is often read as a P/E that matches the growth.
  • Piotroski F-score A 0-9 checklist of financial-health signals (profit, cash flow, debt, margins). 7-9 is strong, 0-3 weak.
  • Preferred dividends Dividends paid to holders of preferred shares, deducted before profit reaches common shareholders.
  • Preferred stock Capital raised with preferred shares, which get their dividends before common shareholders.
  • Pretax income The profit before income tax is deducted.
  • Pretax income growth The change in pretax income compared with the same period a year earlier.
  • Pretax margin Profit before tax as a percentage of revenue.
  • Price target A reference estimate of the share's expected or fair value, useful to compare against the current price.
  • Price-to-earnings ratio Share price divided by trailing earnings per share — roughly how much you pay for each unit of profit. Lower can look cheaper, but it is best compared within a sector.
  • Property, plant and equipment (gross) Physical assets at their original cost, before depreciation is deducted.
  • Property, plant and equipment (net) Buildings, machines, land and other physical assets, after accumulated depreciation.
  • Property, plant and equipment growth The change in net property, plant and equipment compared with a year earlier.
  • Public float The shares available for ordinary trading, excluding those held by insiders and large locked-in owners.
  • Purchase / sale of investments Cash spent on buying investments minus cash received from selling them.
  • Quick ratio Like the current ratio, but without inventory - a stricter test of short-term solvency.
  • Receivable turnover Revenue divided by accounts receivable: how many times a year the company collects its customers' bills.
  • Recession A significant, broad decline in economic activity, often defined as two quarters in a row of falling GDP.
  • Relative strength index (RSI) A 0-100 momentum indicator; above 70 is often called overbought, below 30 oversold.
  • Repurchase of stock (buybacks) Cash spent buying back the company's own shares.
  • Research and development (R&D) Spending on developing new products and technology.
  • Retained earnings All the profit the company has kept over the years instead of paying it out as dividends.
  • Return on assets (ROA) Net income divided by total assets: how much profit the company makes on everything it owns.
  • Return on capital employed (ROCE) Operating profit divided by capital employed (total assets minus current liabilities).
  • Return on equity (ROE) Net income divided by shareholders' equity: the return on the owners' money. Debt can inflate it.
  • Return on invested capital (ROIC) Operating profit after tax divided by all capital invested (equity and debt). Harder to flatter than ROE.
  • Revenue The company's total sales (the top line) over the reporting period, before any costs are taken out.
  • Revenue growth How fast the company's sales are growing from one period to the next.
  • Revenue per share Revenue divided by the number of shares.
  • Risk tolerance How large swings in value you can accept - financially and emotionally - without selling in panic.
  • Session high The highest price the share has traded at during the current session.
  • Session low The lowest price the share has traded at during the current session.
  • SG&A Selling, general and administrative expenses: salaries, marketing, offices and other overheads.
  • Share (stock) A small piece of ownership in a company. Shareholders share in its profits and losses.
  • Share count growth The change in the diluted share count compared with a year earlier.
  • Share price The most recent trading price of a single share.
  • Shareholder yield Dividend yield plus buyback yield: the total cash returned to shareholders as a percentage of market value.
  • Shareholders' equity Assets minus liabilities: the book value that belongs to the shareholders.
  • Shares outstanding The number of shares the company has issued and that are held by investors.
  • Short interest Shares that investors have borrowed and sold, betting on a fall. A high share of the float shorted signals scepticism.
  • Short-term debt Loans and borrowing that must be repaid within a year.
  • Short-term investments Investments the company can turn into cash within a year, such as treasury bills and short bonds.
  • Stance (bias) rating Whether a news article leans for the company, against it, or is neutral.
  • Stock screener A tool that filters listed companies by the numbers you choose.
  • Stock ticker symbol The short symbol that identifies a company's shares on an exchange, such as AAPL for Apple. Click a ticker to open that company's full page.
  • Stock-based compensation Pay to employees in shares or options. It is a real cost to shareholders even though no cash leaves the company.
  • Tangible book value per share Shareholders' equity minus goodwill and intangible assets, divided by the number of shares.
  • Tax payable Income tax the company owes but has not paid yet.
  • Time horizon How long until you need the money. The longer it is, the more short-term swings you can ride out.
  • Total assets Everything the company owns — cash, inventory, property and more — as of the latest quarter.
  • Total assets growth The change in total assets compared with a year earlier.
  • Total current liabilities All obligations due within a year: suppliers, short-term debt, taxes, accrued costs and similar.
  • Total debt All interest-bearing borrowing, short- and long-term.
  • Total equity growth The change in shareholders' equity compared with a year earlier.
  • Total liabilities Everything the company owes: debt, unpaid bills, taxes and other obligations.
  • Total liabilities and equity Everything the company owes plus the owners' equity. It always equals total assets.
  • Total non-current assets All assets the company expects to keep for more than a year: equipment, intangibles, goodwill and long-term investments.
  • Total non-current liabilities All obligations due more than a year from now: long-term debt, leases, pensions and similar.
  • Total operating expenses The running costs of the business apart from the cost of the goods sold: selling, administration, research and similar costs.
  • Trading volume The number of shares traded during the session. Higher volume points to more active trading.
  • Trailing net income The company's total profit over the last four quarters — a rolling one-year figure.
  • Treasury stock Shares the company has bought back and keeps instead of cancelling them, shown as a deduction from equity.
  • Unusual value flag A marker on numbers far outside the normal range (for example a 60 % dividend yield). Often a one-off event or a data error - check before trusting it.
  • Value estimate (Ticker Picker) Ticker Picker's model-based estimate of a share's intrinsic value at a future date. A model, not a promise.
  • Volatility How much and how fast a price moves up and down. Higher volatility means bigger swings in both directions.
  • Working capital Current assets minus current liabilities: the cash tied up in running the business day to day.