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Plain-English explainers about how the stock market works. Definitional, neutral, no investment advice.

Corporate actions

Valuation & fundamentals

P/E ratio explained: trailing vs forward, normal ranges

P/E ratio explained: the formula, trailing vs forward multiples, typical sector ranges, and why a high P/E is not automatically overvaluation.

EPS explained: basic vs diluted earnings per share

How earnings per share is calculated, why analysts focus on diluted EPS, the role of preferred dividends, and how share buybacks lift EPS without changing the business.

Gross, operating & net profit margin explained

The three profit margins — gross, operating, net — what each excludes, the formulas, why industry-typical ranges differ, and how margin differs from markup.

SG&A expense explained: selling, general & administrative

What selling, general & administrative (SG&A) includes on the income statement, the SG&A-to-revenue ratio for peer comparison, and how SG&A differs from COGS and R&D.

Market capitalization explained: small to mega cap

Market capitalization: formula, size buckets (small to mega), free-float vs full cap, enterprise value difference, and the trillion-dollar club.

Dividend yield explained: formula, ranges, and the yield trap

What dividend yield is, how to calculate it from annual dividend and share price, typical ranges by sector, and when a high yield signals dividend cut risk rather than income opportunity.

Beta explained: market sensitivity, ranges, and limitations

What beta measures, how it is calculated from covariance with the market, how to read the number by range, and why a low beta does not guarantee safety.

Price-to-sales ratio (P/S) explained: formula, ranges, margin trap

Price-to-sales ratio: the formula, when P/S is more useful than P/E, typical ranges by sector, and the margin trap that makes the same P/S look very different across companies.

Company lifecycle stages explained: startup, growth, mature, decline

How companies move through four lifecycle stages — startup, growth, mature, and decline — and how each stage changes revenue growth, margins, dividends, and the right valuation metric.

Growth vs value stocks explained: definitions, metrics, and the value trap

What growth stocks and value stocks actually mean, how each style maps to the company lifecycle, which valuation metrics to use for each, and the value trap investors must avoid.

Financial statement analysis

Forecasting & valuation

Returns & market mechanics

Anchor reference