Financial Analysis Fundamentals

Financial analysis is a crucial aspect of assessing a business’s financial health. It offers insights into performance and highlights potential vulnerabilities. In CFI’s “Financial Analysis Fundamentals” course, we will compute and interpret ratios for three different companies, offering insights into their profitability, asset utilization, leverage, and liquidity. Subsequently, we will compare these companies, examining trends, benchmarking, and delving into the DuPont Pyramid.

Financial Analysis Fundamentals Learning Objectives

Calculate and interpret various return ratios, such as return on equity and return on assets.
Conduct an in-depth vertical analysis of the income statement, including the calculation and interpretation of different profitability ratios.
Assess a company’s asset utilization efficiency including undertaking a detailed assessment of its work capital.
Calculate and interpret a wide range of leverage and liquidity ratios.
Conduct and present a comprehensive horizontal (trend) financial analysis.
Compare a company’s performance against that of its industry peers to gain valuable insights.

Recommended Prep Courses

Accounting Fundamentals
Reading Financial Statements

Who should take this financial analysis course?

This financial analysis course is perfect for any aspiring financial analyst working in investment banking, financial planning and analysis (FP&A), equity research, corporate development, and other areas of finance and accounting. This class counts as continuing professional education (CPE) credits for CPAs. For further CPE information, please read before purchasing: https://corporatefinanceinstitute.com/about/cpe-information/

Financial Analysis Fundamentals

Approx 5h to complete

100% online and self-paced

What you'll learn

Multimedia

Introduction

Enjoy a Free Preview Free Preview Course Introduction Free Preview Course Slides

Profitability and Return Ratio Analysis

What is the Best Practice Financial Analysis Free Preview Critical Tips for Effective Financial Analysis Free Preview Financial Analysis Ratio Categories Free Preview The Three Financial Statements Free Preview Return Ratios Free Preview Downloadable Files Model Overview Free Preview End of Free Preview Free Preview Return Ratios Walkthrough Return Ratios Practice Interactive Exercise 1 Profitability and Expense Ratios Tax and Interest Ratios Profitability and Expense Ratios Walkthrough Profitability and Expense Ratios Practice Interactive Exercise 2

Asset Utilization Analysis

Introduction to Asset Utilization Ratios Asset Turnover Ratios Cash Turnover and Days A/R Turnover and Days Inventory Turnover and Days A/P Turnover and Days Working Capital Defined Combining Working Capital Days Ratios Asset Utilization Ratios Walkthrough Asset Utilization Ratios Practice Interactive Exercise 3

Leverage Analysis

Introduction to Financial Leverage Ratios Example of Low Leverage Why Increase Debt Rather than Equity Optimal Leverage Total Assets and Total Liabilities to Equity Ratios Debt to Equity and to Tangible Net Worth Ratios Debt and Net Debt to EBITDA Ratios Leverage Ratios Walkthrough Leverage Ratios Practice Interactive Exercise 4

Liquidity Analysis

Current and Quick Ratios EBITDA to Interest Ratio Liquidity Ratios Walkthrough Liquidity Ratios Practice Interactive Exercise 5

Trend (Horizontal) Analysis

What is Trend Analysis The Benefit of Trend Analysis Downloadable File Trend Analysis Walkthrough Growth Ratios Growth and Degree of Leverage Downloadable File Operative Leverage Scenario Financial Leverage and Growth Financial Leverage Scenario

Peer and Industry Benchmarking

What Is Benchmarking Industry and Peer Group Benchmarking Picking Peer Group for Benchmarking Benchmarking Walkthrough Interactive Exercise 6

Pyramid Analysis

Background to the DuPont Pyramid Breaking Down the DuPont Pyramid Big Retailer 3 Step DuPont Pyramid Walkthrough Mid Retailer 3 Step DuPont Pyramid Practice Small Retailer 3 Step DuPont Pyramid Debrief Interactive Exercise 7 Downloadable Files

Summary

Course Summary Qualified assessment

This Course is Part of the Following Programs

Why stop here? Expand your skills and show your expertise with the professional certifications, specializations, and CPE credits you’re already on your way to earning.

Financial Modeling & Valuation Analyst (FMVA®) Certification

Skills Learned Financial modeling and valuation, sensitivity analysis, strategy
Career Prep Investment banking and equity research, FP&A, corporate development

FinTech Industry Professional (FTIP™)

Skills Learned Financial Technology Fundamentals, Data Science and Machine Learning, Cryptocurrencies and Blockchain
Career Prep Data Science and Machine Learning, Data Analyst, Business Analyst, Software Developer

Financial Planning & Analysis (FP&A) Specialization

Skills Learned Accounting, Finance, Excel, Data Analysis, Financial Statement Analysis, Financial Modeling, Budgeting, Forecasting, Power Query, Power BI, and more.
Career Prep Financial Analyst, Project Evaluator, FP&A Manager and more

Accounting for Financial Analysts Specialization

Skills learned Accounting, Financial Analysis, Reading Financial Statements and more
Career prep Financial Planning & Analysis (FP&A), Corporate Development, Investment Banking, Private Equity, Equity Research, and more.

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Great refresher on financial analysis! The course could not be more precise and practical.

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Very well structured

The course material is relevant to the field of finance and is explained in a clear, concise fashion by the instructors. The inclusion of Excel examples is eye opening.

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Starting from basic analysis, all the way to make a robust pyramid analysis is one of the most fun procedures of learning I had since my birth.

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CFI is one of the rare places where I can get to learn the knowledge required in the working environment, and probably the only one that offers this kind of program on-demand.

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Financial Fundamentals Analysis It was a lot of information and well done!

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Well-structured course Extremely well-structured course that beats the learning offered by degree courses.

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