Core Metrics
AdvancedWhy do accounts receivable and inventory matter?
Fast growth in receivables or inventory can signal weaker demand quality, slower cash conversion, or potential write-down risk.
Quick Definition
Rapidly growing accounts receivable signals slow cash collection; ballooning inventory may mean weak demand. Both can lead to write-offs, cash shortfalls, or earnings quality concerns.
Use this concept with tools
Inflation-adjusted Return
Nominal return vs purchasing-power return.
CAGR
Calculate Compound Annual Growth Rate (CAGR) from start and end values. Convert between annualized returns and final investment amounts. Free CAGR calculator.
Compound Interest
Calculate compound interest growth with recurring contributions. See year-by-year balance breakdowns, total gains, and the power of compounding over time. Free online calculator.
Investor quotes to remember
“If you don't keep learning, others will surpass you.”
“The most dangerous words in investing are 'this time is different'.”
“I only bet when the odds are clearly in my favor.”
“Knowing what you don't know is more important than knowing what you do.”
Related concepts
What does a cash flow statement tell me?
The cash flow statement tracks actual cash in three categories: operating (core business), investing (asset purchases), and financing (debt & equity). Strong operating cash flow is the gold standard of business health.
Can a company be profitable but still short on cash?
Yes — profit is accrual-based (recognized when earned, not collected). A company can show profits while running out of cash due to slow receivables, heavy inventory build-up, or large capital expenditures.
What is the difference between gross margin and net margin?
Gross margin = (Revenue − COGS) ÷ Revenue. Net margin = Net Income ÷ Revenue. Gross margin shows production efficiency; net margin shows overall profitability after all expenses and taxes.