Businesses often use profitability ratios to gauge their performance against industry benchmarks or competitors. Calculating these ratios involves a straightforward process, typically using figures ...

To determine the profitability of banks, simply looking at the earnings per share isn't quite enough. It's also important to know how efficiently a bank is using its assets and equity to generate ...

One way to determine profitability is to calculate the ratio of profits to other financial metrics, such as sales, assets or equity. Common profitability measures include the net income margin, which ...

Learn about gross, operating, and net profit margins, how each is calculated, and how businesses and investors can use them ...

The overhead ratio measures how much of a company's total revenue is spent on indirect costs. This metric is useful for identifying areas where costs can be reduced to improve profitability. Analyzing ...

Successful businesses depend on diligent managers to analyze key factors that influence profitability and make changes to the business based on their analyses. Managers use a variety of statistical ...

Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia. Chip Stapleton is a Series 7 and Series 66 license holder, CFA Level 1 exam holder, and ...