What are Financial Statements? 📜

1. Income Statement:
   It shows how much income the company receives in a given period, its costs and profits.
   • Important Items:
     • Revenue
     • Operating Profit
     • Net Income
2. Balance Sheet:
   It lists the assets, liabilities and equity of the company on a specific date.
   • Important Items:
     • Assets
     • Liabilities
     • Equity
3. Cash Flow Statement:
   It shows the cash inflows and outflows of the company. The activity includes cash flows from investing and financing activities.
   • Important Items:
     • Operating Cash Flow
     • Free Cash Flow

How are Financial Statements Analyzed? 🔍

1. Profitability Analysis: Does the Company Make Money? 💰

To measure profitability, you can use these rates:

• Gross Profit Margin: The rate of profit obtained after deducting costs from income.
  • Simple calculation: Gross Profit/Revenue
• Net Profit Margin: The remaining profit after all expenses are deducted.
  • Simple calculation: Net Profit/Income

2. Liquidity Analysis: Can the Company Pay Off Its Debts? 💧

To measure the capacity of a company to pay its short-term debts:

• Current Ratio:
  • Formula: Current Assets/Current Liabilities
  • Example: If there is an asset of 200,000 TL and a debt of 100,000 TL, the rate is 2. This indicates that the company can easily pay off its debts.
• Acid-Test Ratio: A stricter measurement. It is calculated by subtracting stocks.

3. Debt Analysis: Is the Company Overindebted? 📉

• Debt to Equity Ratio: The ratio of liabilities to equity.
  • Example: If there is a debt of 500.000 TL and 250.000 TL of equity, the ratio is 2. This indicates that the company has more debt than its equity, and it can be a risky situation.

4. Productivity Analysis: How Effectively Does the Company Use Its Resources? ⚙️

• Asset Turnover Rate: It shows how quickly the company uses its assets to generate income.
  • Simple calculation: Revenue/Total Assets

5. Cash Flow Analysis: Is the company's cash position sound? 💵

Positive cash flow indicates that the company has sufficient resources to maintain its operations and invest.

• An important measurement: Free Cash Flow. If it is positive, it means the company is in a good position for growth or debt repayment.

Things to Consider When Doing Financial Analysis 📝

1. Industry Comparison:
   The performance of the company compared to other companies in the same sector. For example, the net profit margin in the technology sector is usually between 10-20%.
2. Trend Analysis:
   Identify growth or decline trends by looking at performance in past years.
3. Special Circumstances:
   Pay attention to how a large investment or one-time expenses affect the results.

👉 Nota: This content is for informational purposes and is not investment advice. 😊

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