Finance

Liquidity position of a company will tell you whether the organization has staying power in tough times. Analyzing company's liquidity position involves examining the relationship of current assets and current liabilities and in short run, how well a company can manage and fulfill its short-term obligations.In absence of adequate cash flow to the business, company may go … [Read more...] about Financial tools to help you assess company’s liquidity position

As a investor, before investing in a publicly traded company, you should know when a stock is over or undervalued. To find it out, the first thing you should know is the intrinsic value of a stock and then compare it with the current market price.In this article, we will be discussing the difference between intrinsic value and current market value of a publicly traded … [Read more...] about Difference between Intrinsic value and Current market value

Special purpose vehicle or SPV is a project company that consists of consortium of shareholders specifically created to build and operate projects. It's also known as special purpose entity/corporation or project company.Special Purpose Vehicle can be formed either as a single legal entity or a joint venture consortium. The main motto for creating a SPV can be to purchase, … [Read more...] about What is special purpose vehicle or entity – SPV/SPE

The average collection period (ACP) of a company refers to the average number of days it takes to convert receivables into cash. It's also known as days sales outstanding.In other words, it's the average number of days company’s customers/clients takes to pay their bills or number of days taken by the company to collect invoiced amount from customers.Average collection … [Read more...] about How to calculate average collection period Ratio – ACP

Inventory turnover ratio shows how often the company replaces its inventory or how well the company generates revenue out of its stock of goods. This ratio is most importantly used as a performance indicator in retail and manufacturing businesses.Inventory/stock of goods of a company includes followings:In retail business most of the inventories are finished goods … [Read more...] about How to calculate inventory turnover ratio – ITR