Financial Ratio Analyzer

Efficiency Metrics

• Asset Turnover
• Inventory Turnover
• Receivables Turnover
• Days Sales Outstanding (DSO)

Valuation Metrics

• Price-to-Earnings (P/E)
• Price-to-Book (P/B)
• Price-to-Sales (P/S)
• EV/EBITDA
• PEG Ratio

Per-Share Analysis

• Earnings Per Share (EPS)
• Book Value per Share
• Dividend Per Share
• Free Cash Flow per Share

Input Formats

The skill accepts financial data in multiple formats:

Structured Data

• CSV files with line items labeled
• JSON with hierarchical financial statements
• Excel files (.xlsx) with organized sections

Text Input

• Natural language descriptions of financials
• Financial statement excerpts
• Quarterly/annual report data

Specific Requirements

• Income Statement: Revenue, COGS, Operating Expenses, Interest, Taxes, Net Income
• Balance Sheet: Assets (current and non-current), Liabilities (current and long-term), Equity
• Cash Flow: Operating, Investing, Financing activities

Output Formats

Results provided in multiple formats:

Detailed Report

• Calculated ratios with values
• Industry benchmark comparisons
• Multi-period trend analysis
• Strengths and weaknesses assessment
• Investment implications

Professional Formats

• PDF report with charts
• Excel workbook with formatted tables
• Dashboard-ready JSON
• HTML report for sharing

Usage Examples

Basic Analysis "Calculate all key financial ratios for this company based on last year's 10-K filing."

Comparative Analysis "Compare the profitability ratios of Company A vs Company B from these financial statements."

Trend Analysis "Analyze the 5-year trend in liquidity ratios - what's the trajectory?"

Investment Decision Support "Based on these financials, is this company undervalued at the current PE ratio of 12x?"

Credit Analysis "Assess the solvency and debt service capability of this company."

Process

1. Data Validation: Verify financial data completeness and consistency
2. Calculation: Compute all relevant ratios from provided data
3. Benchmarking: Compare against industry averages and peers
4. Interpretation: Provide context-specific analysis and insights
5. Visualization: Generate charts and summaries for decision support

Best Practices

• Always validate data completeness before analysis
• Use multiple years for trend identification (minimum 2-3 years)
• Consider industry context - ratios vary significantly by sector
• Cross-check calculations using alternative methods
• Flag unusual values and investigate causes
• Use peer comparison for context
• Consider business cycle impacts

Limitations

• Requires accurate, timely financial data
• Industry benchmarks are general guidelines only
• Historical performance doesn't predict future results
• Doesn't account for qualitative factors (management, strategy, market position)
• Some ratios may not apply to all industries
• Does not provide investment recommendations
• Professional judgment required for final decisions

Technology

Scripts Included

• calculate_ratios.py - Comprehensive ratio calculation engine
• interpret_ratios.py - Interpretation framework with benchmarking

Dependencies

• Python 3.12+
• pandas, numpy for calculations
• matplotlib for visualizations

Quality Assurance

The skill implements comprehensive validation:

• Data consistency checks
• Circular reference detection
• Outlier flagging
• Peer comparison validation
• Ratio cross-verification

Examples & Templates

Reference examples provided for:

• Balance sheet analysis
• Income statement interpretation
• Cash flow assessment
• Multi-company comparisons
• Industry trend analysis

Version: 1.0
Last Updated: 2025-03-05
Status: Production Ready