Financial Vocabulary

#261

Earnings per share

Example sentences

1. The company reported earnings per share of $2.
2. Higher profit increased earnings per share.
3. Investors watch earnings per share each quarter.

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#262

Diluted earnings per share

Example sentences

1. Diluted earnings per share includes possible new shares.
2. The company reported diluted earnings per share of $1.80.
3. Investors compared basic and diluted earnings per share.

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#263

Dividend per share

Example sentences

1. The company paid a dividend per share of $0.50.
2. Dividend per share increased this year.
3. She multiplied dividend per share by the number of shares she owned.

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#264

Dividend yield

Example sentences

1. The stock has a dividend yield of 4%.
2. Dividend yield compares the yearly dividend with the share price.
3. He chose the stock for its stable dividend yield.

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#265

Return on assets

Example sentences

1. The company improved its return on assets.
2. Return on assets shows how well assets create profit.
3. The analyst compared return on assets across two firms.

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#266

Return on equity

Example sentences

1. The bank reported a return on equity of 12%.
2. Return on equity measures profit from owners' money.
3. Investors prefer a stable return on equity.

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#267

Return on invested capital

Example sentences

1. The company's return on invested capital reached 15%.
2. Return on invested capital shows how well capital is used.
3. The manager wants return on invested capital above the cost of capital.

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#268

Current ratio

Example sentences

1. The company has a current ratio of 1.5.
2. The current ratio helps show whether short-term bills can be paid.
3. The bank checked the current ratio before approving the loan.

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#269

Quick ratio

Example sentences

1. The quick ratio excludes inventory.
2. The company improved its quick ratio by collecting cash.
3. A low quick ratio may show a short-term cash problem.

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#270

Debt-to-equity ratio

Example sentences

1. The company has a debt-to-equity ratio of 0.8.
2. A high debt-to-equity ratio can show greater borrowing risk.
3. The investor compared the debt-to-equity ratio with competitors.

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#271

Interest coverage ratio

Example sentences

1. The interest coverage ratio shows whether profit can cover interest.
2. The company's interest coverage ratio improved to five times.
3. The lender reviewed the interest coverage ratio.

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#272

Inventory turnover

Example sentences

1. The store's inventory turnover increased this year.
2. High inventory turnover may mean products sell quickly.
3. The manager calculated inventory turnover every quarter.

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#273

Receivables turnover

Example sentences

1. The company improved receivables turnover by collecting bills faster.
2. Receivables turnover shows how quickly customers pay.
3. The analyst compared receivables turnover with last year.

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#274

Asset turnover

Example sentences

1. The retailer has a high asset turnover.
2. Asset turnover compares sales with total assets.
3. Better use of equipment improved asset turnover.

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#275

Compound annual growth rate

Example sentences

1. Sales had a compound annual growth rate of 8%.
2. The compound annual growth rate shows average yearly growth.
3. She used compound annual growth rate to compare two investments.

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#276

Risk

Example sentences

1. Every investment has some risk.
2. She reduced risk by spreading her money.
3. The manager studied the risk before approving the project.

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#277

Market risk

Example sentences

1. A fall in share prices created market risk.
2. Diversification cannot remove all market risk.
3. The fund measures market risk every day.

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#278

Credit risk

Example sentences

1. The bank checks credit risk before making a loan.
2. Credit risk rises when borrowers may not pay.
3. The bond offers a higher return because of greater credit risk.

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#279

Liquidity risk

Example sentences

1. The company faced liquidity risk when cash became low.
2. Liquidity risk can make it hard to sell an asset quickly.
3. The bank keeps extra cash to reduce liquidity risk.

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#280

Interest rate risk

Example sentences

1. Long-term bonds often have more interest rate risk.
2. The bank used a swap to manage interest rate risk.
3. Rising rates increased the portfolio's interest rate risk.

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