Detailed Explanation of Stock Financial Metrics – Essential Financial Indicators for Stock Trading

  • 2025-07-17

Recently, we have compiled some key stock financial metrics for your reference:  

 

**Operating Revenue**: The regular sales income generated from a company’s primary business activities.  

 

**Gross Profit**: The remaining balance after subtracting the original cost of goods from the sales revenue.  

 

**Net Profit**: The amount remaining after deducting income tax from the company’s total profit, also known as after-tax profit.  

 

**Net Profit Margin**: The ratio of a company’s net profit to its total revenue, reflecting profitability efficiency.  

 

**Adjusted Net Profit (Non-GAAP)**: Net profit excluding non-recurring gains and losses (e.g., asset disposals, investment gains/losses, etc.).  

 

**Price-to-Earnings Ratio (P/E)**: The ratio of stock price to earnings per share, measuring stock valuation.  

 

**Price-to-Book Ratio (P/B)**: The ratio of stock price to net asset value per share.  

 

**Earnings Per Share (EPS)**: Net profit divided by the total number of shares, indicating profitability.  

 

**Net Assets**: Total assets minus total liabilities, also known as shareholders’ equity.  

 

**Book Value Per Share (BVPS)**: The ratio of shareholders’ equity (net assets) to the total number of shares.  

 

**Dividend Yield**: The ratio of dividend per share to the current stock price, measuring dividend income.  

 

**Return on Assets (ROA)**: The ratio of net profit to total assets, measuring asset utilization efficiency.  

 

**Return on Equity (ROE)**: The ratio of net profit to shareholders’ equity, measuring return on equity.  

 

**Debt-to-Equity Ratio**: The ratio of total liabilities to shareholders’ equity, reflecting financial leverage.  

 

**Current Ratio**: Current assets divided by current liabilities, measuring short-term solvency.  

 

**Quick Ratio**: (Current assets minus inventory) divided by current liabilities, measuring immediate solvency.  

 

**Operating Cash Flow**: The difference between cash inflows and outflows from core business operations, reflecting cash generation ability.  

 

**Financing Cash Flow**: Cash flows from fundraising activities, such as issuing stocks or bonds.  

 

**Investing Cash Flow**: Cash flows from long-term asset investments (excluding cash equivalents) and disposal activities.  

 

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