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Financial Ratios: A Guide to Library Resources
Table of Contents:

    Financial ratios show the relationship of one item of a company's financial statement to another item. They are used to assess aspects of profitability, solvency and liquidity. Financial ratios for industries (or industry norms) reflect the average value for the type of business.

    Financial ratios for companies are used by creditors and equity investors to make credit and investment decisions. Industry norms are used by people who want to compare one company's financial report with the industry averages or by people who need to identify changes in the industry's financial performance over several years.

    Print resources are housed in the Business Library collection, basement of Wilson Library.

Finding General Industry Ratios or Industry Norms
    The most useful general ratios are:
  • Key Business Ratios
    Key Business Ratios, from Dun and Bradstreet, help you to assess how a business is doing compared to an industry or a competitor. The 14 key business ratios cover the critical areas of business performance --solvency, efficiency and profitability. They are broken down into median figures, with upper and lower quartiles. Ratios are arranged by Standard Industrial Classification (SIC) Codes -a four-digit number that classifies business establishments by defining the industries in which they do business.
    See the next entry for the print version of these ratios.

    You can choose whether you want general or more specific (solvency, efficiency, profitability) ratios, and you can search by line of business or SIC code.

    • Need definitions of the financial ratios, or information on how they are calculated?
      Use the Key Business Ratios help pages.
  • Bizminer
    BizMiner offers industry financial analysis benchmarks for over 5,000 lines of business and industry market trends on thousands more. Their market analysis reports are available at the national and local levels down to the zip code. Bizminer is a great resource to use when developing business plans, or for any sort of entrepreneurship initiatives where you need to measure peer performance in an industry.
    • Go to the BizMiner financial ratios page:

      Englewood Cliffs, NJ: Prentice-Hall. Annual. WILS BUS Quarto HF5681 .R25 A45

      The source of data is tax returns filed with the U. S. Internal Revenue Service. The most recent edition provides data on millions of U.S. corporations. It provides 50 performance indicators for each industry, and at the end of each industry section, performance indicators for the last 10 years are shown. Data are grouped into 13 categories by size of assets in each industry. About 180 lines of business are covered.

      The Almanac provides norms in actual dollar amounts for revenue and capital factors such as net receivables, inventories, total assets, and it gives you important average operating costs in percent of net sales for: cost of operations, pensions and benefits, compensation of officers, wages and salaries, taxes and more. We have been receiving the annual editions of the Almanac since 1973.

      New York, NY: Dun & Bradstreet. Annual. WILS BUS Quarto HF5681 .R25 I5

      This five volume set contains the most comprehensive industry coverage (including over 800 lines of business). The volumes in the set are: 1) Agriculture, Mining, Construction, Transportation, Communication, Utilities; 2) Manufacturing; 3) Wholesaling; 4) Retailing; 5) Finance, Insurance, Real Estate, Services.

      Ratios are arranged by SIC number, and sub-divided into four geographic areas of the U. S. (at the 2-digit level) and into three to five asset size ranges (at the four digit level).

      For each SIC number covered, the following data is provided: 1) fourteen key business ratios that can be used to analyze solvency, efficiency and profitability, 2) typical balance sheets and income statements for the industry (in dollars), and 3) common-size financial figures (each item of the financial statement as a percentage of its respective aggregate total). The source of data is the Dun & Bradstreet Financial Database. We have been receiving the annual volumes in this set in the Library since 1979.

      Evanston, Ill.: Schonfeld and Associates. Annual. WILS BUS Quarto HF5681 .R25 I27x

      These industry ratios are based on the most recently available income statement and balance sheet data compiled by the Internal Revenue Service of the United States Department of the Treasury. There are 79 ratios or averages given for each industry. We have been receiving this annual publication in the Library regularly since 1991.

      Philadelphia, PA: Risk Management Association. Annual. WILS BUS Quarto HF5681 .B2 R6

      This publication is a product of the commercial banking community and RMA (now Risk Management Association, formerly Robert Morris Associates), the association of lending and credit risk professionals. Over 500 lines of business are covered. Current and comparative historical data are included. Financial statements on each industry are shown in common size form. Sixteen widely used business ratios follow the financial statements.

      Each RMA Annual Statement Studies volume has a section at the front of the volume that gives good definitions of each of the ratios and shows how each was computed. Each volume also has a section at the back called *Sources of Composite Financial Data--A Bibliography* that identifies other major sources of composite financial data for industries. We have been receiving the RMA annual volumes in the Library since 1927.

Other General Ratios
  • Cost of Capital
    Provides industry financial information relating to revenues, profitability, equity returns, ratios, capital structure, cost of equity and weighted average cost of capital. Arranged by SIC code. Provides data on over 300 U S based industries. The main provider of data for Cost of Capital is the Standard & Poors Compustat Data.
    • Location(s): TC Wilson Library Business Reference Quarto HC110.C3 C67 Non-Circulating
    • Check MNCAT Record for Location and Availability
  • S&P Capital IQ NetAdvantage
    Overviews, rankings and comparative statistics for major industries that provides detailed information on public companies such as stock reports, bonds, stock valuation annual reports, and other detailed fianancial statistics. NetAdvantage also includes investment services such as the advisory newsletter Outlook and screening directories for stocks, bonds and mutual funds. There are also directories for private companies and the Register of Corporations, Directors, and Executives
  • IBIS World
    IBIS World provides independent, accurate, comprehensive, and up to date research on over 700 industries, including statistics, analysis and forecasts. Includes global industry reports. While traditional ratios do not appear in the database, IBIS does offer a variety of statistical measures of the industry: Executive Summary, Key Statistics, Segmentation, Market Characteristics, Industry Conditions, Key Factors, Key Competitors, Industry Performance, and Outlook.
  • Value Line Investment Survey
    Value Line investment survey (standard edition) is issued weekly in three parts. The index leads the user to the page on which each company report appears, as well as summarizing key data for all 1,700 stocks profiled. Part III "Ratings and Reports" carries a full page report on each company including 15 years or more of summarized balance sheet and income statement data. The core of the analysis appears in the upper left hand corner, where each stock receives: the timeliness rating, the safety rating, and the beta coefficient.

    Companies are arranged by industry, with a summary page outlining investment prospects for the industry as a whole. On this page you can find some industry ratios providing ratios based on the Value Line companies profiled within the industry.
    • Location(s): WILSON Reference Quarto HG4501 .V26

  • Global Financial Data
    The Global Financial Database is a collection of financial and economic data provided in ASCII or Excel format. There are 20,000 historical or current data series which may be downloaded directly from the web site. Global coverage includes stocks, bonds, treasury bills, interest rates, commodity prices, CPI, GDP, exchange rates, indexes, population and more.
    Looking for Financial Ratios for a specific company (not the industry)? Type the company name in the search box, bring up the main screen for the corporation, then look for the Ratios tab at the top right of the screen.
Do It Yourself! Produce your own ratios--
  • Mergent Online
    Profiles of public corporations around the world that includes summaries, company histories, property, financials, subsdiaries, joint ventures, long term, press release and historical annual reports. Licensed for 60 simultaneous users
  • ThomsonOne
    Can be used with Internet Explorer ONLY, other browsers do not work. Please allow pop-ups, as this is necessary for proper display. Thomson ONE brings together company information from a variety of sources that are produced by Thomson Reuters. This includes company financials and filings, mergers and acquisition data and analyst reports. The following types of information are available: Company Overviews, Company News and Pricecharts, Corporate Governance (Takeover defense), Corporate financial fundamentals, Estimates (and earnings surprises), Debt overview, Company deals, Share ownership information, Company research (formerly Investext), Company financial filings, Officers and Directors.
    • Ratios are on the companies overview page.

  • CompactD SEC
    CompactD SEC provides reports on publicly held companies. Company profiles include descriptions, address, state of incorporation, stock exchange, ticker symbol, primary and secondary SIC codes, number of shareholders, number of shares outstanding, number of employees, etc. The bulk of each report is comprised of financial information taken from the quarterly and annual financial statements including key ratios, and summary stock price, ownership and dividend figures with previous 5 year comparison data. Data is compiled from SEC filings. Because the same format is used on all the disks, you can use them to get a series of statistical data on corporations in the U.S. from the 1980s through 2003. CDROM is only available on Business Reference workstations.
    • Location(s): Please email for access details
Definitions of Ratios: What does it all mean?
Do you need to know how the ratios are computed or what they can be used to evaluate? Information on how the ratios are constructed and what they can be used to measure are included in the following sources:
  • Check these:

    Good definitions of ratios appear at the front of each volume of the RMA STATEMENT STUDIES in the *Definition of Ratios* section [WILS REF Quarto HF5681 .B R6] and at the front of the IRS CORPORATE FINANCIAL RATIOS [WILS REF Quarto HF5681 .R25 I27x].

    Other books on ratio analysis and financial statement analysis include:

    • Subramanyam, K. R.
      Financial statement analysis / K.R. Subramanyam, John J. Wild. Boston : McGraw-Hill Irwin, c2009.
      TC Wilson Library Reserve HF5681.B2 W4963 2009
      [Contributor biographical information ]--
      [Publisher description ]--
      [Table of contents only ]--

    • Bull, Richard.
      Financial ratios : how to use financial ratios to maximise value and success for your business / Richard Bull. Burlington, MA : Elsevier, c2008.
      TC Wilson Library HF5681.R25 B85 2008 Regular Loan

    • Palepu, Krishna G., 1954-
      Business analysis & valuation : using financial statements / Krishna G. Palepu, Paul M. Healy. Mason, OH : Thomson/South-Western, c2008.
      TC Wilson Library Reserve Quarto HF5681.V3 P295 2008

    • Bragg, Steven M.
      Financial analysis : a controller's guide / Steven M. Bragg. Hoboken, N.J. : John Wiley, c2007.
      TC Wilson Library HG4026 .B663 2007

    • Fraser, Lyn M.
      Understanding financial statements / Lyn M. Fraser, Aileen Ormiston. Upper Saddle River, N.J. : Pearson/Prentice Hall, c2007.
      TC Wilson Library Reference HF5681.B2 F764 2007
      [Table of contents ]--

    • Kline, Brian.
      How to read and understand financial statements when you don't know what you are looking at / by Brian Kline. Ocala, Fla. : Atlantic Pub., c2007.
      TC Wilson Library HF5681.B2 K555 2007

    • Stickney, Clyde P., 1944-
      Financial reporting, financial statement analysis, and valuation : a strategic perspective / Clyde P. Stickney, Paul R. Brown, James M. Wahlen. Mason, OH : Thomson/South-Western, c2007.
      TC Wilson Library HF5635 .S857 2007

    • Berman, Karen, 1962-
      Financial intelligence : a manager's guide to knowing what the numbers really mean / Karen Berman and Joe Knight ; with John Case. Boston : Harvard Business School Press, c2006.
      TC Wilson Library HG4028.B2 B422 2006
      [Table of contents ]--

    • Peterson Drake, Pamela, 1954-
      Analysis of financial statements / Pamela P. Peterson, Frank J. Fabozzi. Hoboken, N.J. : Wiley, c2006.
      TC Wilson Library HG4026 .P463 2006

    • Epstein, Lita.
      Reading financial reports for dummies / by Lita Epstein. Hoboken, NJ : Wiley Pub., c2005.
      TC Wilson Library HF5681.B2 E67 2005

    • Kwok, Benny K. B.
      Accounting irregularities in financial statements : a definitive guide for litigators, auditors, and fraud investigators / Benny K.B. Kwok. Aldershot, Hants, England ; Burlington, VT : Gower, c2005.
      TC Wilson Library HF5686.C7 K85 2005
      [Table of contents ]--

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