Also called asset management ratios. Of particular interest to management and financial analysts. Total asset turnover may be too broad oftentimes to be useful. The components would be important. Profitability ratios - indicate combined use of both assets and debt.
Net margin is sometimes too broad, and can mask underlying problems.
These reflect market perceptions of company performance and market expectations of the future. See T3.10 V. for definitions of these ratios. Consider a very operationally efficient company with no debt and an average operationally efficient company with moderate to significant debt. Inflation can have a distortionary effect on ratios. As an example, consider the effect of inflation on total asset turnover for a capital intensive company.