Investor glossary

Amortization is the process of decreasing or accounting for an amount over a period of time. It is the allocation of a lump sum amount to different time periods, particularly for loans and other forms of finance, including related interest or other finance charges.

This value is calculated as the total revenues for the trailing 12 months divided by the average total assets. Average total assets is defined as the total assets for the five most recent quarters, divided by 5.

The price movement of a security measured against the overall stock market. The bigger the beta coefficient of a security, the greater its volatility.

The common shareholder's equity divided by the shares outstanding at the end of the most recent fiscal quarter.

Represents cash, and all securities that can readily be transferred into cash, as listed in the current assets section.

In financial and business accounting, earnings before interest and taxes (EBIT) is a measure of a firm's profitability that excludes interest and income tax expenses.

The common stock cash dividends per share for the selected time period.

The proportion of current assets to the current liabilities of an organization.

Total debt for the most recent interim period divided by total shareholder equity for the same period.

The compound annual growth rate of cash dividends per common share of stock over the last 5 years.

The current percentage dividend yield based on the present cash dividend rate, calculated as the indicated annual dividend divided by the current price, multiplied by 100.

The company's earnings per share (EPS) calculated using fully diluted shares outstanding (i.e., including the impact of stock option grants and convertible bonds). Diluted EPS indicates a "worst case" scenario, one in which everyone who could have received stock without purchasing it directly for the full market value did so.

The compound annual growth rate of earnings per share excluding extraordinary items and discontinued operations over the last 5 years.

This is the number of freely traded shares in the hands of the public.

Generally accepted accounting principles are accounting rules used to prepare, present, and report financial statements for a wide variety of entities, including publicly-traded and privately-held companies, non-profit organizations, and governments. US GAAP includes the applicable accounting framework, and related accounting law, rules and accounting standards according to United States.

Calculated by determining the gross margin for each of the five most recent fiscal years, and then averaging the values. Gross margin is total revenue minus cost of goods sold divided by total revenue, and is expressed as a percentage.

Also known as pretax income and earnings before taxes: total revenue minus total expenses plus non-operating income (expenses).

An IPO, also referred to simply as a "public offering", is when a company issues common stock or shares to the public for the first time. IPOs are often issued by smaller, younger companies seeking capital to expand, but can also be made by large privately-owned companies looking to become publicly traded.

When one company acquires another, the purchase price must be allocated to the individual assets being purchased. Some are expensed immediately, while others are allocated to assets and may be expensed in later years (through depreciation or amortization). In the case of an acquired company’s in-process research and development projects, the amount is expensed in full immediately.

The number of institutions (pension funds, mutual funds, etc.) that currently report an investment position in the company's stock.

Non-monetary assets that cannot be seen, touched or physically measured, which are created through time and/or effort, and which are identifiable as a separate asset. There are two primary forms of intangibles – legal intangibles (such as trade secrets, e.g., customer lists, copyrights, patents, trademarks, and goodwill) and competitive intangibles (know-how, collaboration activities, leverage activities, and structural activities).

This ratio is the total long-term debt for the most recent fiscal quarter divided by total shareholder equity for the same period.

Calculated by multiplying the current share price by the current number of shares outstanding.

Net income is equal to the income that a firm has after subtracting costs and expenses from total revenue. Net income can be distributed among holders of common stock as a dividend or held by the firm as retained earnings.

The economic value of an investment can be calculated by forecasting all the cash inflows and outflows associated with the project and discounting them back to present day value. The net present value is the present value of the cash inflows less the outflows.

Also known as return on sales: the income after taxes for the trailing 12 months divided by total revenue for the same period, expressed as a percentage.

The sum of all revenues (sales) reported for all operating divisions. Refers to business income in general, or may refer to the amount received during a period of time.

The percentage of revenues remaining after paying all operating expenses, calculated as the trailing 12 months’ operating income divided by the trailing 12 months’ total revenue, multiplied by 100.

An operating expense, operating expenditure, operational expense, operational expenditure, or OPEX is an on-going cost for running a product, business, or system. OPEX may also include the cost of workers and facility expenses such as rent and utilities.

The highest price the stock traded at in the last 12 months, which could be an intraday high.

The lowest price the stock traded at in the last 12 months, which could be an intraday low.

The price divided by the latest quarterly book value per share.

Calculated by dividing the current price by the sum of the primary earnings per share from continuing operations before extraordinary items and accounting changes over the last four quarters.

Also known as the Acid Test Ratio: cash plus short term investments plus accounts receivable for the most recent fiscal quarter, divided by total current liabilities for the same period.

Income after taxes for the trailing 12 months divided by the average total assets, expressed as a percentage. The average total assets is calculated by adding the total assets for the five most recent quarters and dividing by 5.

Income after taxes for the trailing 12 months divided by the average total assets, expressed as a percentage. The average total assets is calculated by adding the total assets for the five most recent quarters and dividing by 5.

The income available to common stockholders for the trailing 12 months divided by the common equity, expressed as a percentage. Average common equity is calculated by adding the common equity for the five most recent quarters and dividing by 5.

The trailing 12-month income after taxes divided by the average total long term debt, other long term liabilities, and shareholders equity, expressed as a percentage.

Expenses related to activities covering selling and general administration

Selling securities, commodities etc. which one does not own, in the hope of buying later at a lower price.

A convertible bond that is not secured by any assets, but has priority in a liquidation.

In financial markets, a share is a unit of account for various financial instruments including stocks, mutual funds, and limited partnerships. The income received from shares is called a dividend. A person owning shares is called a shareholder.

The number of shares outstanding at the end of a fiscal period as reported in the balance sheet: the number of shares issued minus the shares held in treasury.

Debt that comes due within 1 year.

SIX is Switzerland's stock exchange, based in Zürich. The exchange also trades other securities such as Swiss government bonds, and derivatives such as stock options.

Swiss Market Index represents about 85% of the free-float capitalization of the Swiss equity market. The index comprises the 20 largest and most liquid equities of the SPI® (Swiss Performance Index®)

The effective tax rate is the amount of tax an individual or firm pays when all other government tax offsets or payments are applied, divided by the tax base (total income or spending). If certain groups have high degrees of tax offsets compared to other groups, their effective tax rate will be lower, even if their official tax rates and marginal tax rates are the same.

The sum of all short  and long term asset categories.

The sum of all current assets reported for the most recent time list.

The sum of all current liabilities reported for the selected time period.

The sum of short term debt, the current portion of long term debt, and capitalized lease obligations.

The sum of all the individual equity line items on the quarterly balance sheet.

The sum of all current and long term liabilities reported.

The total of the individual operating expense line items.

Volume within investor relations refers to the number of shares traded in a given period. Volume can be used to gauge the intensity of investor attitudes towards a security. It is normal for volume to increase on rallies and to decrease on declines. Any observation to the contrary is a good warning signal of a trend reversal.