Investors and financial analysts often rely on the profitability index (PI) to determine whether the benefits of an investment opportunity outweigh its costs. Essentially, the PI compares projected ...

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 ...

Our Profitability Index metric looks at a firm's ability to convert revenue into profits. This metric, introduced in 1985, seeks to demonstrate which firms best balance leverage and profit margin for ...

Learn how to calculate the combined ratio for insurance companies, including financial and trade basis methods, using loss and expense ratios for profitability analysis.