In financial modeling, it’s common to use ratios for analyzing a company’s historical performance and forecasting how it’s going to perform in the future. The most common financial modeling ratios are: year-over-year growth rate, gross margin, EBITDA margin, net profit margin, current assets to current liabilities, debt to equity, debt to EBITDA, debt to capital, net income to equity (ROE), net income to capital (ROIC), net income to assets (ROA), depreciation to capex, earnings per share (EPS), and cash flow per share (CFPS).
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In order to become a great financial analyst, below are some additional questions and answers for you to explore further:
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