Andrew Almeida, CFA
Andrew is a Chartered Financial Analyst and outsourced Chief Investment Officer to family offices, hedge funds, and start ups. His expertise includes investment analysis and selection across all asset classes. Most recently, his focus has been on uncovering value across the Web3 landscape and advising on new projects. During the 13+ years of his career, he’s worked at financial firms including JPMorgan Chase, Advisors Asset Management, and City National Bank, where he served as Associate Portfolio Manager on $1.25 billion of multi-asset class portfolios.
Reviewed by Andrew
Return on Equity (ROE)
Return on equity (ROE) is a financial ratio that is calculated by dividing net income by shareholders' equity. It is a commonly used measure of profitability.
Diluted shares occur when a company issues additional shares of stock, resulting in the current shares now representing a lower percentage of ownership.
Accounts Payable (AP)
Accounts payable are the short-term debts owed by a company to its creditors and suppliers for goods or services that have been received but not yet been paid for.
Industries and Sectors
Sectors and industries are used to sort and group segments of an economy. One is broader than the other, but the terms used depend on the classification system.
Preferred stock is a category of stock that comes with certain rights, which differ from those that accompany common stock. Here's how they compare.
Accounts Receivable (AR)
Accounts receivable, or AR, represent money owed to a company for goods and services it has provided to customers but has not yet received payment for.
Negative P/E Ratio
The price-to-earnings (P/E) ratio is a valuation metric that looks at share price relative to EPS. A negative P/E ratio means that a stock is losing money.
Cash and Cash Equivalents
Cash and cash equivalents (CCE) are assets that are immediately available as cash, meaning they can be converted into cash within fewer than 90 days.
Convertible securities are financial instruments that can be exchanged for other types of tradable assets from the same issuer, typically shares of common stock.
A fiscal year is a 12-month period of financial reporting. Companies generally choose to use a fiscal year or calendar year based on the nature of the business.
Property, Plant, and Equipment (PP&E)
Property, plant, and equipment (PP&E) are a company’s physical assets that have a lifespan longer than one year and are not easily converted into cash.
Forward P/E Ratio
The forward price-to-earnings (P/E) ratio is a valuation metric that compares a stock’s share price to its forecasted earnings per share. Here is a complete guide.
The market-to-book ratio is a metric that compares the price of a stock to its book value. It tells you the price the market is putting on the company's assets.
Marketable securities are short-term assets that can be sold quickly and converted into cash. Here is an overview including examples and how they're used in formulas.
Intangible assets are the non-physical resources that a company owns. Here is an overview, examples, and information on how to value intangibles.
Effective Tax Rate
The effective tax rate is the percentage of income a company or individual pays in taxes. Here's how it compares to the corporate income and marginal tax rates.
Gross margin measures the percentage of revenue a company retains after deducting the costs of producing the goods or services it sells. Here's how to calculate it.
Working capital is a measure of a company’s liquidity, specifically its short-term financial health and whether it has the cash on hand for normal business operations.
Net Profit Margin
Net profit margin is a profitability metric that shows net income as a percent of revenue. Here's a complete guide, including how it compares to gross profit margin.
Types of Costs in Accounting
In accounting, costs are categorized to help analyze how well a business is generating profits from revenue. Here are the different types and how they're used.
Shares outstanding is a financial number that represents all the shares of a company’s stock that shareholders currently own. Here's how to find and use it.
Debt-to-Equity (D/E) Ratio
The debt-to-equity (D/E) ratio shows how much debt, relative to equity, a company is using to finance its operations. This guide includes the formula and examples.
Free Cash Flow per Share
Free cash flow shows how much cash a company has left after paying to run its core business and maintain its capital assets. FCF per share is this amount, per share.
Dividend Payout Ratio
The dividend payout ratio shows how much of a company’s net income goes to paying dividends. Here is a complete overview including how to calculate and use it.
Corporate Income Tax
Here is a comprehensive overview of U.S. corporate income tax, including federal and state rates, how it works, how to calculate it, and historical trends.
Operating Expenditure (OpEx)
Operating expenditure (OpEx) accounts for the day-to-day expenses of a business. Here's a complete guide, including the formula and how it compares to CapEx.
Cost of Revenue
Cost of revenue represents the total cost of making and delivering a service or product. It’s normally used for service companies in place of the cost of goods sold (COGS).
Pretax income refers to total income before taxes are deducted. It's commonly known as income before taxes, pretax profit, or earnings before taxes.
Revenue growth is a term used to describe a company’s increase in revenue over a period of time, usually quarter-over-quarter or year-over-year.
Operating income is the profit left after paying for all expenses related to a company's core operations. It is a commonly used measure of profitability.
Trailing Twelve Months (TTM)
TTM is a financial term that stands for trailing twelve months. It represents a company's financial numbers over the past four quarters.
Cost of Goods Sold (COGS)
The Cost of Goods Sold (COGS) is the cost required to produce the goods a company sells. Here is a detailed definition, formula, uses, and downsides.
Earnings Per Share (EPS)
Earnings per share (EPS) is a commonly used number to describe a company's profitability. It represents the portion of earnings allocated to each share.
Earnings Before Interest and Taxes (EBIT)
Earnings Before Interest and Taxes (EBIT) is a measure of a company’s earnings. Here are the uses and limitations of EBIT, as well as how to calculate it.
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) is a measure of a company’s earnings. Here's how to calculate and use EBITDA.