Reading the numbers
Glossary — the shorthand, decoded
Every abbreviation Pythia uses in tables, score drill-ins and screener columns, defined once, with a link to a fuller definition for each.
How to use this page
Financial shorthand is compressed rather than complicated. Almost every term below is a ratio, and almost every ratio is one number divided by another number that puts it in context.
If you meet an unfamiliar abbreviation anywhere on Pythia, it is here, and the metric popover on the number itself carries the same definition plus the inputs that produced that specific value.
The terms
- EV
- Enterprise Value = Market Cap + Total Debt − Cash & equivalents. definitionfor EV on Investopedia (opens in a new tab)
- EBIT
- Earnings before interest and taxes (≈ Operating Income). definitionfor EBIT on Investopedia (opens in a new tab)
- EBITDA
- EBIT + Depreciation & Amortization. definitionfor EBITDA on Investopedia (opens in a new tab)
- FCF
- Free Cash Flow = Operating Cash Flow − Capital Expenditures. definitionfor FCF on Investopedia (opens in a new tab)
- GP/A
- Gross Profit / Total Assets (Novy-Marx gross profitability). definitionfor GP/A on Investopedia (opens in a new tab)
- ROIC
- Return on Invested Capital ≈ EBIT / (Equity + Debt − Cash). definitionfor ROIC on Investopedia (opens in a new tab)
- ROE
- Return on Equity = Net Income / Shareholders Equity. definitionfor ROE on Investopedia (opens in a new tab)
- P/E
- Price-to-Earnings = Price / EPS (TTM). definitionfor P/E on Investopedia (opens in a new tab)
- B/M
- Book-to-Market = Book Equity / Market Cap (Fama-French). definitionfor B/M on Investopedia (opens in a new tab)
- CAGR
- Compound Annual Growth Rate over the chosen window. definitionfor CAGR on Investopedia (opens in a new tab)
- GICS
- Global Industry Classification Standard — 11 sectors. definitionfor GICS on Investopedia (opens in a new tab)
- z-score
- (Value − Sector Mean) / Sector Standard Deviation. definitionfor z-score on Investopedia (opens in a new tab)
- P/S
- Price-to-Sales = Market Cap / Revenue. Inverse is sales yield. definitionfor P/S on Investopedia (opens in a new tab)
- P/B
- Price-to-Book = Market Cap / Book Equity. Inverse is book-to-market (B/M). definitionfor P/B on Investopedia (opens in a new tab)
- EV/EBITDA
- Enterprise Value / EBITDA — common operating multiple when D&A is large. definitionfor EV/EBITDA on Investopedia (opens in a new tab)
- WACC
- Weighted Average Cost of Capital — hurdle rate for value-creating ROIC. definitionfor WACC on Investopedia (opens in a new tab)
- EPS
- Earnings per Share = Net Income / Diluted shares. definitionfor EPS on Investopedia (opens in a new tab)
- TTM
- Trailing Twelve Months — sum of the last four reported quarters. definitionfor TTM on Investopedia (opens in a new tab)
- Mkt Cap
- Market Cap = Share Price × Shares Outstanding. definitionfor Mkt Cap on Investopedia (opens in a new tab)
- β
- Beta — historical price sensitivity vs the broad market (1.0 ≈ market-like). definitionfor β on Investopedia (opens in a new tab)
- Div Yield
- Annual dividend per share / current price. definitionfor Div Yield on Investopedia (opens in a new tab)
- COGS
- Cost of Goods Sold — direct costs to produce revenue. definitionfor COGS on Investopedia (opens in a new tab)
- Capex
- Capital Expenditures — cash spent on long-lived assets. definitionfor Capex on Investopedia (opens in a new tab)
- D&A
- Depreciation & Amortization — non-cash charges spreading past investments. definitionfor D&A on Investopedia (opens in a new tab)
- NWC
- Net Working Capital = Current Assets − Current Liabilities. definitionfor NWC on Investopedia (opens in a new tab)
- OP/BE
- Operating Profitability = Operating Income / Book Equity. definitionfor OP/BE on Investopedia (opens in a new tab)
- F-Score
- Piotroski F-Score — nine pass/fail fundamental health tests (0–9). definitionfor F-Score on Investopedia (opens in a new tab)
- GB Rank
- Greenblatt combined rank on earnings yield + return on capital. definitionfor GB Rank on Investopedia (opens in a new tab)
- PEG
- Price/Earnings to Growth = P/E ÷ EPS growth rate (%). definitionfor PEG on Investopedia (opens in a new tab)
Three that cause the most confusion
TTM and LTM mean the same thing — trailing (or last) twelve months. They exist because a fiscal year is an accounting convenience and rarely ends when you happen to be looking. A TTM figure sums the last four reported quarters, so it is always current to the most recent filing rather than to a year end.
Enterprise value is not market cap. Market cap prices the equity; enterprise value prices the whole business by adding debt and subtracting cash. Two companies with identical market caps can have very different enterprise values, and any multiple built on EV is comparing something different from one built on price.
A z-score is a position, not a quality. It says how many standard deviations a value sits from the mean of its comparison group. It carries no opinion about whether high is good — that depends entirely on the metric, and it is why a low valuation z-score is favourable while a low profitability z-score is not.
Where the sector labels come from
Sector and industry on Pythia follow GICS, the classification MSCI and S&P maintain jointly. It matters more than a taxonomy usually would, because every sector-neutral comparison — the z-scores behind PAS, the peer sets behind percentile ranks — is computed within a GICS sector and country.
Companies we cannot classify are marked Unclassified and get no PAS — rather than being placed in a peer group they do not belong to, or scored by some other method that would not mean the same thing.
Check yourself
4 questions. Nothing is recorded unless you are signed in, and nothing here affects anything else.
Sources
- Investopedia — Enterprise value (opens in a new tab) — Each term below also links to its own definition page.
- MSCI GICS — the Global Industry Classification Standard (opens in a new tab) — The sector taxonomy every sector-neutral comparison on Pythia uses.
Further reading
- Introduction to Investing (opens in a new tab) — Start here if terms like P/E or market cap are new.