Reading Balance Sheets

A balance sheet is a snapshot of everything a company owns (assets) and everything it owes (liabilities) at a specific point in time. The difference is shareholder equity — what would be left for shareholders if the company paid off all its debts.

Current Assets (Most Important for Net-Nets)

Cash and equivalents: Money in the bank. The safest asset. Accounts receivable: Money customers owe the company. Inventory: Products ready to sell. Short-term investments: Securities that can be sold within a year.

Current Liabilities

Accounts payable: Money the company owes suppliers. Short-term debt: Loans due within a year. Accrued expenses: Bills received but not yet paid.

The Key Ratios

Current ratio (Current Assets / Current Liabilities): Above 2.0 is Graham's benchmark. Debt-to-equity (Total Debt / Equity): Lower is better. Zero debt is ideal for net-nets.

Our stock pages show key balance sheet data when API keys are configured. Visit any stock page and check the Fundamentals tab.