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 Terms Beginning with T

# Tangible Leverage Ratio

Fundamental Analysis Term

Tangible Leverage Ratio is a financial ratio used in fundamental analysis to measure the amount of debt a company has in relation to its tangible assets. It is a variation of the traditional leverage ratio that considers only tangible assets, which are assets that can be physically observed or touched, such as buildings, machinery, and inventory.

The Tangible Leverage Ratio is calculated by dividing the company's total debt by its tangible assets. The formula is as follows:

Tangible Leverage Ratio = Total Debt / Tangible Assets

This ratio provides an indication of the level of debt a company has with respect to its tangible assets, which can be an important factor in assessing its financial health and stability. A high ratio suggests that the company is highly leveraged and may struggle to meet its financial obligations, while a low ratio indicates that the company has a lower risk of default.

Tangible Leverage Ratio is particularly useful in industries where a company's tangible assets are a significant portion of its total assets, such as manufacturing or real estate. By focusing on tangible assets, this ratio can provide a more accurate assessment of the company's ability to meet its financial obligations, as it excludes liabilities that are not backed by physical assets, such as patents, trademarks, or goodwill.

Overall, the Tangible Leverage Ratio is a useful tool in fundamental analysis that can help investors assess the financial strength and stability of a company and make informed investment decisions.

# Tangible Leverage Ratio

Fundamental Analysis Term

Tangible Leverage Ratio is a financial ratio used in fundamental analysis to measure the amount of debt a company has in relation to its tangible assets. It is a variation of the traditional leverage ratio that considers only tangible assets, which are assets that can be physically observed or touched, such as buildings, machinery, and inventory.

The Tangible Leverage Ratio is calculated by dividing the company's total debt by its tangible assets. The formula is as follows:

Tangible Leverage Ratio = Total Debt / Tangible Assets

This ratio provides an indication of the level of debt a company has with respect to its tangible assets, which can be an important factor in assessing its financial health and stability. A high ratio suggests that the company is highly leveraged and may struggle to meet its financial obligations, while a low ratio indicates that the company has a lower risk of default.

Tangible Leverage Ratio is particularly useful in industries where a company's tangible assets are a significant portion of its total assets, such as manufacturing or real estate. By focusing on tangible assets, this ratio can provide a more accurate assessment of the company's ability to meet its financial obligations, as it excludes liabilities that are not backed by physical assets, such as patents, trademarks, or goodwill.

Overall, the Tangible Leverage Ratio is a useful tool in fundamental analysis that can help investors assess the financial strength and stability of a company and make informed investment decisions.

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