Profitability ratios are used to evaluate a company's ability to make money within a given period of time compared to its expenses and other costs associated with income. This ratio reflects the end result of the company.
Profitability represents the final performance of a company i.e. how profitable a company is. It also represents how profitable the owner’s funds have been utilized in the company.
Net Income / Shareholder’s Equity
Net Profit ÷ Total no of shares outstanding
Amount Distributed to Shareholders ÷ No of Shares outstanding
Market Price of Share ÷ Earnings per share
Net Operating Profit ÷ Capital Employed × 100 Capital Employed
Net Profit ÷ Total Assets
Gross Profit ÷ Sales × 100
Net Profit ÷ Sales × 100