Fixed Costs Explained: Definitions, Formulas and Examples
Fixed costs are a parallel concept to variable costs in corporate finance and business management. Understanding fixed costs allows companies to better
Sensitivity Analysis Explained: Definitions, Formulas and Examples
Sensitivity analysis is an indispensable tool utilized in corporate finance and business analysis to comprehend how the variability in key input variables
LBO Modelling Guide: Definitions, Concepts, and Examples
LBO (Leveraged Buyout) Modelling is one of the core tools for M&A in corporate finance. LBO models are a type of financial
Earnings Per Share (EPS): Definitions, Formulas, Examples
Earnings per share (EPS) is a key metric used to evaluate a company's profitability on a per-share basis. EPS indicates profitability for
Dividend Coverage Ratio (DCR): Definitions, Formulas, and Examples
Dividend coverage is an important risk metric for equity analysts and investors, spotlighting a company's ability to pay dividends to its shareholders.
What is an Annuity?
Annuities are an essential concept in both individual finance and corporate finance contexts. A simple annuity is a series of equal payments
Basis Points (BPS) Explained: Definitions and Examples
Basis points (BPS) is the common term for 1/100th of 1 percent or 0.01%. This unit might not seem worth naming, but
Equity Risk Premium (ERP): Definitions, Formulas and Examples
The equity risk premium (ERP) is a crucial concept in corporate finance and investment analysis. It signifies the additional return that investors
Discounted Cash Flow Models (DCF): Guide and Examples
Discounted cash flow (DCF) analysis is a method used in corporate finance and valuation to estimate the attractiveness of an investment opportunity.
EBITDA Explained: Definitions, Formulas and Examples
EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) is perhaps the most important financial metric used in valuing companies. EBITDA as a
Financial Modelling Guide: Model Types and Examples
Financial modelling and forecasting is a crucial life skill for anyone with ambitions to be an entrepreneur or who wants to be
Internal Rate of Return (IRR): Formulas, Examples and Implications
The Internal Rate of Return (IRR) can be viewed as the rate of return implicit within a set of cashflows. It could
Payback Period Explained: Definitions, Formulas and Examples
Payback period is a fundamental investment appraisal technique in corporate financial management. It is a measure of how long it takes for
What is Compound Annual Growth Rate (CAGR)?
Compound annual growth rate (CAGR) is a useful metric for presenting a variable growth trend by its implied weighted-average compound growth
Variable Costs Explained: Definitions, Formulas and Examples
Variable costs represent a critical component of financial analysis and business decision making. By understanding how to calculate and analyse variable costs,