What components would you use to convince an investor about your company's financial health?
1. Liquidity: the amount of cash as well as the cash that is easily convertible to cash assets owned by a company. Liquidity is first considered for the short-term and then for the long-term.
2. Solvency: The company can meet its obligations continuously.
3. Operating Efficiency: It is the best source of its financial success and operating margin is used to indicate the efficiency.
4. Profitability: In evaluating a company, liquidity, operating efficiency, and basic solvency can perform better. Net margin is a good metric for the evaluation of profitability.