# Plain-English definitions for every metric that appears in a Standard Equity report. Organised by category — click any metric for the full definition, formula, and a note on why it matters. Terms: 78 Categories: 15 For how the metrics are computed and where the data comes from, see the [methodology](https://standard-equity.report/methodology). Part 1 ## Income Statement 7 terms | [Revenue](https://standard-equity.report/glossary/revenue) | Total sales the company generated over the reporting period. | | ---------------------------------------------------------------------------- | ----------------------------------------------------------------------------- | | [Revenue Growth](https://standard-equity.report/glossary/revenue-growth) | Year-over-year percentage change in revenue. | | [Gross Profit](https://standard-equity.report/glossary/gross-profit) | Revenue minus the direct cost of producing what was sold. | | [Operating Profit](https://standard-equity.report/glossary/operating-profit) | Profit from core operations before interest and taxes (EBIT). | | [EBITDA](https://standard-equity.report/glossary/ebitda) | Earnings before interest, taxes, depreciation, and amortization. | | [Net Income](https://standard-equity.report/glossary/net-income) | Bottom-line profit after every expense, including interest and taxes. | | [Net Investment Result](https://standard-equity.report/glossary/net-investment-result) (Holding companies) | A holding company's top line: income and fair-value gains on its investments. | Part 2 ## Margins 5 terms | [Gross Margin](https://standard-equity.report/glossary/gross-margin) | Gross profit as a percentage of revenue. | | ------------------------------------------------ | --------------------------------------------------------- | | [Operating Margin](https://standard-equity.report/glossary/operating-margin) | Operating profit as a percentage of revenue. | | [Net Margin](https://standard-equity.report/glossary/net-margin) | Net income as a percentage of revenue. | | [Pretax Margin](https://standard-equity.report/glossary/pretax-margin) (Banks) | Pretax income as a percentage of revenue. Used for banks. | | [FCF Margin](https://standard-equity.report/glossary/fcf-margin) | Free cash flow as a percentage of revenue. | Part 3 ## Per-Share 7 terms | [EPS — Earnings Per Share (Diluted)](https://standard-equity.report/glossary/eps-diluted) | Net income divided by diluted shares outstanding. | | -------------------------------------------------------------------------------- | --------------------------------------------------------- | | [EPS Growth](https://standard-equity.report/glossary/eps-growth) | Year-over-year percentage change in diluted EPS. | | [Book Value Per Share](https://standard-equity.report/glossary/book-value-per-share) | Total equity divided by diluted shares outstanding. | | [Tangible Book Value Per Share](https://standard-equity.report/glossary/tangible-book-value-per-share) (Banks) | Book value excluding goodwill and intangibles, per share. | | [FCF Per Share](https://standard-equity.report/glossary/fcf-per-share) | Free cash flow divided by diluted shares outstanding. | | [DPS — Dividends Per Share](https://standard-equity.report/glossary/dps) | Total dividends paid per share over the period. | | [Revenue Per Share](https://standard-equity.report/glossary/revenue-per-share) | Revenue divided by diluted shares outstanding. | Part 4 ## Returns 4 terms | [ROIC — Return on Invested Capital](https://standard-equity.report/glossary/roic) | After-tax operating profit divided by total invested capital. | | ---------------------------------------------------------- | ------------------------------------------------------------- | | [ROE — Return on Equity](https://standard-equity.report/glossary/roe) | Net income divided by total equity. | | [ROA — Return on Assets](https://standard-equity.report/glossary/roa) | Net income divided by total assets. | | [ROTE — Return on Tangible Equity](https://standard-equity.report/glossary/rote) (Banks) | Net income divided by tangible equity. Bank-specific. | Part 5 ## Growth 1 term | [NII Growth](https://standard-equity.report/glossary/nii-growth) (Banks) | Year-over-year change in Net Interest Income. Bank-specific. | | ------------------------------------------ | ------------------------------------------------------------ | Part 6 ## Valuation 12 terms | [P/E — Price-to-Earnings Ratio](https://standard-equity.report/glossary/pe-ratio) | Stock price divided by earnings per share. | | --------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------- | | [EV/EBIT](https://standard-equity.report/glossary/ev-ebit) | Enterprise value divided by operating profit. | | [P/TBV — Price to Tangible Book Value](https://standard-equity.report/glossary/p-tbv) (Banks) | Stock price divided by tangible book value per share. Bank-specific. | | [P/B — Price to Book Ratio](https://standard-equity.report/glossary/p-b) | Market cap divided by total equity. | | [EV/EBITDA](https://standard-equity.report/glossary/ev-ebitda) | Enterprise value divided by EBITDA. | | [P/FCF — Price to Free Cash Flow](https://standard-equity.report/glossary/p-fcf) | Market cap divided by free cash flow. | | [Enterprise Value](https://standard-equity.report/glossary/enterprise-value) | What it would cost to buy the entire business: market cap plus debt, minus cash. | | [Market Capitalization](https://standard-equity.report/glossary/market-cap) | Total market value of the company's equity. | | [Reference Value (Expected Value)](https://standard-equity.report/glossary/reference-value) | The probability-weighted average of our simulated DCF values, shown beside the median and the base case. | | [SE Grade (stars)](https://standard-equity.report/glossary/se-grade) | 0–3 stars for how good and durable the business is. The price moves it one notch at most; the rank only lowers it. | | [Reference Range (central 50%)](https://standard-equity.report/glossary/reference-range) | The range holding the middle 50% of our simulated values (25th to 75th percentile). Model-implied, not yet calibrated. | | [What the Price Assumes](https://standard-equity.report/glossary/price-assumes) | The growth, margin and year-10 revenue the current price needs, set against judgement base rates. | Part 7 ## Yield 3 terms | [Dividend Yield](https://standard-equity.report/glossary/dividend-yield) | Annual dividends per share as a percentage of stock price. | | ------------------------------------------ | ---------------------------------------------------------- | | [FCF Yield](https://standard-equity.report/glossary/fcf-yield) | Free cash flow as a percentage of market cap. | | [Earnings Yield](https://standard-equity.report/glossary/earnings-yield) | EPS as a percentage of stock price. Inverse of P/E. | Part 8 ## Capital Allocation 3 terms | [Payout Ratio](https://standard-equity.report/glossary/payout-ratio) | Dividends per share as a percentage of EPS. | | ------------------------------------------------------------ | ----------------------------------------------------------------------------- | | [Buyback Yield](https://standard-equity.report/glossary/buyback-yield) | Year-over-year percentage change in shares outstanding (negative = buybacks). | | [Shares Outstanding (Diluted)](https://standard-equity.report/glossary/shares-outstanding) | Total diluted share count. | Part 9 ## Cash Flow 4 terms | [FCF — Free Cash Flow](https://standard-equity.report/glossary/free-cash-flow) | Operating cash flow minus capital expenditure. | | ------------------------------------------------------ | ----------------------------------------------------------------------- | | [Capital Expenditure (CapEx)](https://standard-equity.report/glossary/capex) | Cash spent on property, plant, and equipment. | | [Operating Cash Flow](https://standard-equity.report/glossary/operating-cash-flow) | Cash generated from core business operations. | | [FCF-to-Net-Income Ratio](https://standard-equity.report/glossary/fcf-to-net-income) | Free cash flow divided by net income — a quality-of-earnings indicator. | Part 10 ## Balance Sheet 4 terms | [Debt-to-Equity Ratio](https://standard-equity.report/glossary/debt-to-equity) | Total debt divided by total equity. | | ---------------------------------------------------------------- | --------------------------------------------- | | [Long-Term Debt](https://standard-equity.report/glossary/long-term-debt) | Debt obligations due more than 12 months out. | | [Net Debt](https://standard-equity.report/glossary/net-debt) | Total debt minus cash and equivalents. | | [Interest Coverage (EBIT/Interest)](https://standard-equity.report/glossary/interest-coverage) | Operating profit divided by interest expense. | Part 11 ## Banks 5 terms | [NIM — Net Interest Margin](https://standard-equity.report/glossary/nim) (Banks) | Net interest income as a percentage of average interest-earning assets. | | ------------------------------------------------------------------ | ------------------------------------------------------------------------------------ | | [Loan yld — Loan Yield](https://standard-equity.report/glossary/loan-yield) (Banks) | Net interest income as a percentage of average loans. | | [NII — Net Interest Income](https://standard-equity.report/glossary/net-interest-income) (Banks) | Interest revenue minus interest expense. Core bank revenue. | | [Efficiency Ratio](https://standard-equity.report/glossary/efficiency-ratio) (Banks) | Non-interest expense as a percentage of revenue before loan losses. Lower is better. | | [Equity-to-Assets Ratio](https://standard-equity.report/glossary/equity-to-assets) (Banks) | Total equity as a percentage of total assets. Bank capital adequacy. | Part 12 ## Insurance 5 terms | [Combined Ratio](https://standard-equity.report/glossary/combined-ratio) (Insurance) | Claims, underwriting costs and expenses as a percentage of premiums. Below 100% is an underwriting profit. | | ----------------------------------------------------------------------------------------- | ---------------------------------------------------------------------------------------------------------- | | [Benefit Ratio](https://standard-equity.report/glossary/benefit-ratio) (Insurance) | Policy benefits and claims as a percentage of premiums. | | [Premium Growth](https://standard-equity.report/glossary/premium-growth) (Insurance) | Year-on-year growth in premiums earned. | | [Investment Yield](https://standard-equity.report/glossary/investment-yield) (Insurance) | Investment income as a percentage of average invested assets. | | [Book Value per Share Growth](https://standard-equity.report/glossary/book-value-growth) (Insurance, Holding companies) | Year-on-year growth in book value per share. | Part 13 ## REITs 4 terms | [FFO per Share — Funds From Operations](https://standard-equity.report/glossary/ffo-per-share) (REITs) | A REIT's earnings per share before real-estate depreciation and property-sale gains. | | ------------------------------------------------------------------------ | ------------------------------------------------------------------------------------ | | [FFO Growth](https://standard-equity.report/glossary/ffo-growth) (REITs) | Year-over-year percentage change in FFO per share. | | [P/FFO — Price-to-FFO](https://standard-equity.report/glossary/p-ffo) (REITs) | Stock price divided by FFO per share. | | [FFO Payout Ratio](https://standard-equity.report/glossary/ffo-payout-ratio) (REITs) | Dividends per share as a percentage of FFO per share. | Part 14 ## Breakdown Tables 10 terms | [Driver (Profit, Revenue, Growth)](https://standard-equity.report/glossary/driver-table) | The first bottom table: which parts of the business drive profit or revenue, or how its main lines are growing. | | ------------------------------------------------------------------------------- | --------------------------------------------------------------------------------------------------------------- | | [Revenue by region, Revenue mix and Asset mix](https://standard-equity.report/glossary/revenue-regions-lines) | The second bottom table: where revenue comes from, else what it is made of. | | [Reinvestment returns and Financing](https://standard-equity.report/glossary/reinvestment-table) | The third bottom table: how much of its earnings the company reinvests, and what that earns. | | [Reinvestment Rate and Retention Rate](https://standard-equity.report/glossary/reinvestment-rate) | The share of earnings put back into the business instead of paid out. | | [Return on Capital](https://standard-equity.report/glossary/return-on-capital) | The profit each unit of capital in use earns, as a median over the window. | | [Spread over hurdle / Cost of Equity](https://standard-equity.report/glossary/spread-over-hurdle) | Return on capital minus the discount rate the fair value uses. | | [Rel growth](https://standard-equity.report/glossary/relative-growth) | How fast a Driver row grew against the company's total revenue: 1.00x is in line. | | [Rel margin](https://standard-equity.report/glossary/relative-margin) | A segment's margin against the margin of the profit-making segments together: 1.00x is the group's own. | | [Top 3 coverage](https://standard-equity.report/glossary/top-3-coverage) | How much of the total the three rows shown add up to, in the column heading. | | [Trend](https://standard-equity.report/glossary/trend-column) | Small bars, one per fiscal year, drawn like the main table's trend bars. | Part 15 ## Analyst & Spread 4 terms | [Consensus Price](https://standard-equity.report/glossary/consensus-price) | Low, mean, median, and high price targets from sell-side analysts. | | -------------------------------------------------- | ----------------------------------------------------------------------------------------------------------------------------------- | | [Estimate Spread](https://standard-equity.report/glossary/estimate-spread) | How tight the range around an estimate is. Shown as 0–3 dots: more dots, a tighter spread. | | [Blended Consensus](https://standard-equity.report/glossary/blended-consensus) | An estimate from two or three analysts, mixed with our own trend in proportion to the analyst count; a lone analyst is not counted. | | [Data Coverage Indicator](https://standard-equity.report/glossary/data-coverage) | Visual flag (○) when a metric uses partial or limited historical data. | ## At a glance | Terms | 78 | | ---------- | -- | | Categories | 15 | ## In this report 1. [Income Statement](#income-statement) 2. [Margins](#margins) 3. [Per-Share](#per-share) 4. [Returns](#returns) 5. [Growth](#growth) 6. [Valuation](#valuation) 7. [Yield](#yield) 8. [Capital Allocation](#capital-allocation) 9. [Cash Flow](#cash-flow) 10. [Balance Sheet](#balance-sheet) 11. [Banks](#banks) 12. [Insurance](#insurance) 13. [REITs](#reits) 14. [Breakdown Tables](#breakdown-tables) 15. [Analyst & Spread](#analyst-spread)