Revenue Analysis

directory

Introduction Introduction indicators Edit this paragraph profitability analysis refers to enterprises through asset management's ability to achieve much revenue analysis conducted by the center, including a number of indicators, the analysis of multiple projects. Profitability analysis of distraction is the core of the financial statements, or that the financial statements based on profitability analysis distraction unfolding. Profitability analysis is one of the main financial analysis, it is the past, the main measure of financial investment, operation and financing decisions made by the results. The main question to be answered is whether the resources are effectively utilized, whether the expected profitability, as well as fund-raising activities are cautious and so on. An organization's profitability will first affect their market value, that is, its stock price, or the price at the time of the acquisition; secondly, profitability determines an institution's ability to refinance debt or, reflected in the number of its financing , timeliness, and cost, etc.; Moreover, the income index is a measure of an important indicator of performance, or to determine the future profitability goals. Edit this paragraph indicators for U.S. banks,Adidas AdiPure FG, for example, the profitability analysis of the major indicators are described below. First, the return on equity and return on assets.

financial profit

ROE that is commonly referred to as ROE (Return on Equity), is a measure of profitability the most important indicator, which combines all the benefits of the bank's performance, represents the institution to raise capital in the market competitiveness. "Return on equity (ROE) = Net income (Net Income) / common equity (Common Equity)", on behalf of the rate of return on common shareholders, shareholder value is a measure of the main financial indicators. Return on assets, often referred to ROA (Return on Assets), is the most commonly used indicator of profitability.

sales margin

"return on assets (ROA) = Net income (Net Income) / Total Assets (Total Assets)", reflects the rate of return on all assets. Return on equity and return on assets, respectively,Mens Nike Free 3.0 V4, and can be analyzed by the following formula to reflect: "Return on equity (ROE) = return on assets (ROA) × Financial leverage ratio (Leverage Multiplier)", ie capital gains rate depends on capital gains rate and the size of financial leverage. If the return on assets was negative, the higher the rate of financial leverage, the lower the rate of return on equity; And even if a positive rate of return on assets, if financial leverage is low, then the capital gains rate is not high. "Return on assets (ROA) = Net Profit Margin (Net Margin) × asset utilization levels (Asset Utilization)",

sales rate

ie capital gains rate depends on the level of net profit margin and asset utilization. "Financial leverage (Leverage Multiplier) = total assets (Total Assets) / common equity (Common Equity)", which means ordinary shares of the supported unit amount of assets. Financial leverage ratio and debt ratio is proportional to the rate of financial leverage is higher, on behalf of units of capital can dominate more assets, in general, shareholders or investors have a tendency to increase financial leverage. But the high financial leverage ratio implies low capital adequacy ratio, representing the capital for risk coverage is too low, the creditors will be prohibitive, but also by regulatory authorities and some of the regulations is prohibited. Further analysis of decomposition ROE formula: "Net profit margin (Net (or profit) Margin) = Net income (Net Income) / Revenue (Operating Revenue)", which means that from interest income and non-interest income, after deducting all expenses The remaining net income ratios. "Asset utilization level (Asset Utilization) = Operating income (Operating Revenue) / Total Assets (Total Assets)", which means that all of the income generated by the assets, total assets reflects the output capacity.

total sales margin

In addition, there are a number of indicators from different perspectives reflecting banks' profitability. "Profitability (Earnings power) = earning assets (Earning Assets) / Total Assets (Total Assets)", reflected in the total assets of the proportion of earning assets. Obviously, the higher the proportion of earning assets, its profitability is stronger. However,Nike Total90, concerning the bank's overall strength, long-term competitiveness, and so many factors, but depends nonprofit asset quality and efficiency. Therefore, the proportion of earning assets is not better. "Efficiency (Efficiency) = Non-interest expense (Noninterest expense) / [(Net Interest Income Net interest income + non-interest income Noninterest income)]", which is a measure of the efficiency of a comprehensive index, reflecting the inputs required per unit of output. "Total assets interest margin (Interest margin (total assets)) = Net interest income (Net interest Income) / Total Assets (Total Assets)", represents the total rate of return on assets, net interest, fully reflect the financial activities of interest return. "Interest-earning assets slip (Interest Margin (earning assets)) = Net interest income (Net interest income) / earning assets (Earning Assets)", represents net interest earning assets rate of return. "Earning assets yield (Yield on Earning Assets) = Interest income (Interest Income) / earning assets (Earning Assets)", reflects the profitability of assets total output capability. "All the cost of capital rate (Cost Rate on Total Funds) = interest expense (Interest Expense) / [all liabilities (Total Liabilities) + Equity (Equity)], reflecting the full funding of total interest costs." Interest cost of funds rate (Cost Rate on Interest-bearing Funds) = interest expense (Interest Expense) / interest-bearing liabilities of (Interest-bearing Liabilities) ", reflecting the average interest cost of interest-bearing liabilities." spread (Spread) = earning assets yield ( Yield on Earning Assets) - interest cost of funds rate (Cost Rate on Interest-bearing Funds) ", on behalf of earning assets in the net assets of payment of interest rates broadly reflect the marginal rate of return on earning assets. Overall, equity Yield is the most important indicators of profitability, in order to maximize value for shareholders for the goal of the bank is particularly true return on equity and return on assets depends on financial leverage, and capital gains rate depends on the ratio of earning assets, as well as those assets operating efficiency. operational efficiency can be improved from the income-generating capacity, but also can come from cost reductions, the two may be referred to revenue efficiency and cost efficiency. [1]