Analyzing Financial Ratios

Computes, normalizes, and interprets financial ratios across four categories — liquidity, profitability, leverage, and efficiency — with mandatory peer benchmarking and time-series context. Produces analyst-ready output suitable for equity research reports, credit assessments, and comparable company analyses.

When To Use

• Equity research initiation or update requiring comparable company analysis
• Credit review or loan underwriting where leverage and coverage ratios determine capacity
• M&A screening to identify valuation anomalies or operational gaps between target and acquirer
• Portfolio monitoring when financial statements are freshly filed and ratios need updating
• Board-level or investment committee reporting on company financial health
• Any scenario where a single ratio has been cited without peer or temporal context — this skill enforces the discipline of comparison

Do not use for pure valuation (DCF, multiples-based pricing) — this skill feeds into valuation but does not produce one.

Inputs To Gather

Before computing any ratio, confirm every item below. Pause and ask if any are missing.