v1.0.0 cosmicstack-labs

Financial Analysis

Ratio analysis, cash flow, ROI, break-even, forecasting, and financial storytelling

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Financial Analysis#

Analyze financial statements and business health.

Key Ratios#

Profitability#

Ratio	Formula	Healthy
Gross Margin	(Revenue - COGS) / Revenue	>50% typical
Operating Margin	Operating Income / Revenue	>15%
Net Margin	Net Income / Revenue	>10%
ROE	Net Income / Shareholder Equity	>15%
ROA	Net Income / Total Assets	>5%

Liquidity#

Ratio	Formula	Healthy
Current	Current Assets / Current Liabilities	>1.5
Quick	(Current Assets - Inventory) / Current Liabilities	>1.0
Cash	Cash & Equivalents / Current Liabilities	>0.5

Efficiency#

Ratio	Formula	Healthy
Asset Turnover	Revenue / Total Assets	Industry-specific
Inventory Turnover	COGS / Avg Inventory	Higher is better
DSO	(AR / Revenue) × 365	<45 days

Cash Flow Analysis#

Operating CF should be positive and growing
Investing CF negative = investing in growth
Financing CF reveals debt/equity strategy
Free Cash Flow = Operating CF - CapEx

Break-Even Analysis#

Break-Even Units = Fixed Costs / (Selling Price - Variable Cost)
Break-Even Revenue = Break-Even Units × Selling Price

Financial Storytelling#

Start with the headline (the "so what")
Use trends, not snapshots (3-5 year view)
Compare to benchmarks (industry, historical, budget)
Highlight leading indicators, not just lagging
Include risk factors and assumptions

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