Industry Information: Industry ratios

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Industry Ratios - Online Sources

Start with RMA e-Statement Studies, which is organized by NAICS codes. Be aware that its coverage is primarily for the US.

For Refinitiv Workspace you will need to start by searching for a specific public company in the industry you're interested in. Note that this database requires registration for an individual account.

RMA eStatement Studies from eMentor This link opens in a new window
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Industry ratios organized by NAICS codes, and revenue ranges.
Former title: Annual Statement Studies, from the Risk Management Association. Composite performance metrics derived from the financial statements of financial institutions' borrowers and prospects.
Workspace from LSEG (formerly Refinitiv Workspace) This link opens in a new window
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For public companies provides: financial data; annual & other reports/filings; analyst & market research reports; M&A, new issues & syndicated loans data. Coverage: ~12,000 US companies & ~41,000 non-US companies.
Download limit of 150 pages / 24-hour period for After Market Research module (aka AMR or Investext).
Formerly called Thomson ONE.

What are industry ratios?

'Industry ratios' are composites (averaged aggregates) of the 'financial ratios' for several (or many) individual companies. (Financial ratios show the relationships between two bits of financial information culled from a company's financial statements, e.g. stock price to stock earnings.) When the ratios are calculated from data in the financial statements of several (or many) companies in the same industry, then they become industry ratios.

They are most often used to compare one company's financial performance to the financial performance of many comparable companies, in order to assess the 'health' of that one company ...

Basically they help to answer the question: is company x doing as well as, better or worse than its peers and competitors?

Problems:

1. How do you define the industry you're looking at?

It could be by using NAICS or GICS codes, or another classification system. Or it could be that you have to define your industry yourself, based on other criteria ...

2. How do you account for companies of different sizes?

Microsoft and your local website designer are technically in the same broad industry (software services), but their vastly different sizes make a direct comparison useless. The RMA Annual Statement Studies provide the ratios for different sizes companies. Financial Studies of the Small Business only looks at businesses with capitalization of less than $1-2 million, but is very old and no longer published.

Industry Ratios - Print Sources

Almanac of Business and Industrial Financial Ratios by Troy, Leo
Call Number: HF 5681.R25 A45
Current edition kept in Raynor Reference; older editions on Memorial 4 (upper).

Yeah, I know ... these are not online! But they're classics, and you'll hear them mentioned regularly. Especially the RMA and Leo Troy books ... For small businesses, Financial Studies of the Small Business may also be helpful though it is somewhat dated.

RMA Annual Statement Studies by Risk Management Association (formerly Robert Morris Associates)
Call Number: HF 5681 .B2 R6
Current edition kept in Raynor Reference; older editions on Memorial 4 (upper).
It includes data from private companies, and from small and medium size enterprises. Read their Definition of Ratios Introduction to learn more about interpreting the data.
Industry Norms and Key Business Ratios by Dun & Bradstreet
Call Number: HF 5681 .R25 I53
Current edition kept in Raynor Reference; older editions on Memorial 4 (upper).
Financial Studies of the Small Business by Financial Research Associates
Call Number: Raynor Ref HD 2346 .U5 F55a 29th ed. 2006
Standard & Poor's Analysts' Handbook by S & P
Call Number: Ref HG 4905 .A66
Current edition in the Reference collection; older editions on Memorial Level 4 Upper.
While the other sources listed here are organized by SIC and/or NAICS, this one is organized by GICS codes.