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Glossary

Indicator glossary

What each indicator on the stock, FII and ETF pages means, in plain language: the formula the site uses, an example and what to watch for.

Educational content to understand what each number means. It is not a recommendation to buy or sell.

Stocks: price relative to the business

• P/E (price to earnings) — How many reais the market pays today for each real of the company's yearly profit.
• Trailing 12-month P/E (TTM) — The P/E built on the last 12 months of profit instead of the last closed fiscal year.
• P/B (price to book value) — How much the market pays for the company's book equity: 1 means market value equals equity.
• EV/EBITDA — How many years of EBITDA (approximate operating cash generation) fit in the value of the whole company, debt included.
• EV/EBIT — The value of the whole company divided by operating profit before interest and taxes.
• P/EBITDA and P/EBIT — Market value (equity only, no debt) divided by EBITDA or EBIT.
• P/Sales and EV/Sales — How much the market pays for each real of the company's sales.
• Earning yield — Yearly profit as a percentage of market value: the P/E turned upside down.
• FCF yield (free cash flow yield) — How much free cash the company generated in the year for each real of its market value.
• P/OCF and P/FCF — Market value divided by the cash operations generated (P/OCF) or by the cash left after capex (P/FCF).
• Market value (market cap) — The price the exchange puts on the whole company: share price times number of shares.
• Enterprise value (EV) — Market value plus net debt: what it would cost to buy the whole company, taking on its debts.
• EPS (earnings per share) — The year's profit divided by the number of shares: the slice of profit belonging to each share.
• BVPS (book value per share) — Equity divided by the number of shares: what would be left per share if assets were sold at balance-sheet value and debts paid.

Stocks: profitability, margins and growth

• ROE (return on equity) — How much the company earned in the year for each real of shareholders' equity.
• ROIC (return on invested capital) — How much the business yields, after tax, on the money (own and borrowed) put into it.
• ROA (return on assets) — How much the company earned in the year for each real of assets it owns, whether financed by debt or own capital.
• Asset turnover — How much the company sells in the year for each real of assets.
• Gross margin — Of each real sold, how much is left after the direct cost of what was sold.
• EBITDA margin — Of each real sold, how much is left as approximate operating cash generation.
• EBIT margin (operating margin) — Of each real sold, how much is left from operations before interest and taxes.
• Net margin — Of each real sold, how much ends up as profit after all costs, interest and taxes.
• Revenue growth — How much sales grew against the previous year (1 year) or, on average per year, over five years (5-year CAGR).
• CAGR (compound annual growth rate) — The average yearly growth rate between two endpoints, as if growth were the same every year.
• Piotroski F-Score — A 0-to-9 score counting how many of nine simple financial-health tests the company passed.

Stocks: debt and liquidity

• EBIT — The result of the company's operations before interest and taxes.
• EBITDA — An approximation of the cash the operation generates: operating result plus depreciation and amortization.
• Net debt — What the company owes in loans, after subtracting the money it has in cash and investments.
• Net debt / EBITDA — In how many years of operating cash generation the company could pay its net debt, at the current level.
• Net debt / equity and gross debt / equity — How much the company owes in loans relative to shareholders' equity.
• Equity/Assets and Liabilities/Assets — What share of what the company owns belongs to shareholders and what share to third parties.
• Current ratio — Whether what the company has in cash and receivables in the short term covers what it must pay in the short term.

Stocks: dividends

• Dividend yield (DY) — How much the stock paid in cash distributions, as a percentage of price.
• 12-month DY — Dividend yield calculated on the last 12 months of distributions.
• Return of capital — Money the company gives back to shareholders by reducing its own capital; it is not distributed profit.
• Payout ratio — What share of the year's profit the company paid out to shareholders.

Real-estate funds (FII)

• P/BV of a FII — How much the market pays for the unit relative to its net asset value: below 1, a discount; above 1, a premium.
• NAV per unit — The fund's net assets divided by the number of units.
• Vacancy — The share of the real-estate fund's area that is empty, with no tenant.

ETFs

• Premium and discount — How far the ETF's exchange price is above (premium) or below (discount) the fund's unit value on the same day.
• Effective fee — What the ETF actually charges per year, as a percentage of net assets, measured by the expenses the fund booked.
• Fund net assets — The total value of the fund's assets after obligations: the size of the ETF.
• Unitholders — The number of investors holding units of the fund.
• Average daily liquidity — How many reais of the ETF typically trade per day on the exchange.
• Return by NAV (fund return) — How much the ETF returned, measured by the change in the fund's unit value, which already includes what the portfolio received.

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