Glossary: M05 — Company Analysis: Past and Present
| Term | Definition |
|---|---|
| Bottom-Up Revenue Analysis | Forecasting revenue by aggregating individual segment or product-level data |
| Business Model | The framework describing how a company creates, delivers, and captures value |
| Capital Expenditure (CapEx) | Spending on long-term assets such as property, plant, and equipment |
| Capital Structure | The mix of debt and equity financing used by a company |
| Cash Conversion Cycle (CCC) | Days Sales Outstanding + Days Inventory Outstanding - Days Payable Outstanding |
| Company Research Report | A structured analysis document containing recommendation, financials, valuation, and risks |
| Cost of Goods Sold (COGS) | Direct costs attributable to the production of goods or services sold |
| Days Inventory Outstanding (DIO) | Average number of days inventory is held before being sold |
| Days Payable Outstanding (DPO) | Average number of days a company takes to pay its suppliers |
| Days Sales Outstanding (DSO) | Average number of days to collect payment after a sale |
| EBITDA | Earnings Before Interest, Taxes, Depreciation, and Amortization |
| EBITDA Margin | EBITDA divided by revenue; measures operating profitability before non-cash charges |
| ESG | Environmental, Social, and Governance factors considered in investment analysis |
| Gross Margin | (Revenue - COGS) / Revenue; measures production profitability |
| Growth CapEx | Capital expenditure aimed at expanding the company’s productive capacity |
| Maintenance CapEx | Capital expenditure needed to maintain existing assets and operations |
| Market Share | A company’s revenue as a percentage of total industry revenue |
| Operating Margin | Operating income divided by revenue; measures core business profitability |
| Pricing Power | A company’s ability to raise prices without losing significant sales volume |
| Profitability | The ability of a company to generate earnings relative to revenue, assets, or equity |
| ROIC (Return on Invested Capital) | NOPAT divided by invested capital; measures efficiency of capital allocation |
| Top-Down Revenue Analysis | Forecasting revenue starting from macroeconomic and industry-level data |
| Total Addressable Market (TAM) | The total market demand for a product or service |
| Value Chain | The full range of activities a company performs to deliver a product from conception to delivery |
| Value Proposition | The unique value a company offers to its customers that differentiates it from competitors |
| Working Capital | Current assets minus current liabilities; measures short-term liquidity |
Related: M05 Module Page | Equity Formulas