What are the three most important ratios to look at when valuing a business?

ChaosNantuko answered one year ago …

Return on equity, because it gives a good estimation of earnings growth.
Price to earnings, because it tells you what premium your paying for that return on equity, and market cap, because it can be useful in determining how high the barriers for entry are in the industry. The higher the Return on equity, the faster you can expect earnings to grow, and the higher the price to earnings can be while still making for a good investment. The higher the market cap, the less susceptible to company is to a startup breaking into the business and stealing away market share. For more information on comparing earnings growth to market cap, read my article here: http://tycoonreport.tycoonresearch.com/articles/322616102/a-fundamental-look-at-growth-stocks