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Every Ratio Behind a Stock's Score, Explained Simply

Published 2 Sep 2026 · 21 ratios, 5 pillars, plain English

Score Your Stock checks 21 individual numbers on every company, grouped into 5 pillars. Each one answers one plain-English question, backed by its formula, and a picture of where Strong, Okay, and Weak actually start.

1. Business Strength (5 ratios)

Is the business actually good at making money?

Return on Equity (ROE)

For every RM100 you'd have put in, how hard does the company actually make that money work each year?

Formula: Net profit ÷ shareholders' equity × 100

4-Year Revenue Growth

Is the shop pulling in more customers each year, or the same crowd on repeat?

Formula: 3-year annualized revenue growth rate

Weakbelow 0%/yr
Okay0 to +8%/yr
Strong+8%/yr or more
4-Year Profit Growth

Sales going up is nice — but is more of it actually turning into real profit, year after year?

Formula: 3-year annualized profit growth rate

Weakbelow 0%/yr, or any loss year
Okay0 to +8%/yr
Strong+8%/yr or more
Net Profit Margin

Out of every RM100 that walks in the door, how much is left after paying every single bill?

Formula: Net profit ÷ revenue × 100

Quarterly Momentum

A fresher check-in — is the business still growing right now, not just in last year's annual report?

Formula: Last 4 quarters' revenue vs. the 4 quarters before that

2. Financial Safety (3 ratios)

Could it survive a bad year without getting into trouble?

Debt-to-Equity

How much of the company is actually the owner's own money, vs. money borrowed from the bank?

Formula: Total debt ÷ shareholders' equity

Current Ratio

If every bill due this year landed on the desk today, could the company actually pay them all?

Formula: Current assets ÷ current liabilities

Interest Coverage

How easily does profit cover just the interest on its loans — comfortably, or barely scraping by?

Formula: Operating profit (EBIT) ÷ interest expense

See all 21, with real numbers, on a real company

3. Cash & Dividends (5 ratios)

Does owning it actually pay you, reliably?

Dividend Quality

The size of your yearly "pocket money" from owning the stock — and whether it actually shows up, year after year.

Formula: No single formula — yield %, adjusted for how often dividends were cut over 4 years

Weak3 or more down-years, stopped, or never paid
Okay2 down-years
Strong0–1 down-years
Operating Cash Flow

Profit is what the accountant says happened. Cash is what's actually sitting in the bank. This checks the real thing.

Formula: No formula — read straight off the cash flow statement, judged on 4-year trend

Weaklatest year negative, or negative in 2 or more years
Okaypositive, but not clearly growing
Strongpositive every year, and the latest is at least 110% of the first
Free Cash Flow

Cash left over after keeping the lights on and buying new equipment — this is what actually funds your dividend.

Formula: Operating cash flow − capital spending

Weaklatest year negative
Okayotherwise positive
Strongpositive in 3 of the last 4 years, latest positive
Cash & Cash Equivalents

The company's emergency fund. Growing = breathing room. Shrinking = something to watch.

Formula: No formula — cash trend over 4 years vs. short-term debt

Weakneither
Okaycash grew, or it covers short-term debt
Strongcash grew and it covers short-term debt
Dividend Payout Ratio

How much of profit gets handed back to shareholders vs. kept in the business. Shown for reference — it doesn't change the score, except for banks and REITs.

Formula: Dividends paid ÷ net profit × 100

4. Price Fairness (3 ratios)

Are you paying a fair price for all of the above?

P/E Ratio

How many years of today's profit you're paying for, upfront, just to own one share.

Formula: Share price ÷ earnings per share

P/B Ratio

Are you paying more than what the company would be worth if it sold everything and paid off every debt today?

Formula: Share price ÷ book value per share

PEG Ratio

Adjusts the price tag for how fast profit is actually growing — a fast grower can "deserve" a higher price.

Formula: P/E ÷ yearly profit growth %

5. Risk (5 ratios)

Is any of this a real pattern, or one lucky year?

Earnings Consistency

4 years of profit — was it a steady climb, or a rollercoaster?

Formula: No formula — counts down-years out of the last 4

Weak3 or more down-years, or any loss year
Okay2 down-years
Strong0–1 down-years
Debt Trend (4yr)

Is the company paying down its loans over time, or quietly piling on more?

Formula: 3-year annualized debt growth rate

Weakrose more than 10%
Okaywithin ±10%
Strongfell more than 10%
Share Count Trend (4yr)

Is your slice of the pie shrinking because the company keeps printing new shares to raise cash?

Formula: 3-year annualized growth in shares outstanding

Weakabove +8%/yr
Okay+2 to +8%/yr
Strongbelow +2%/yr
Inventory vs Sales (4yr)

Is unsold stock piling up in the warehouse faster than it's actually selling?

Formula: Inventory growth rate − revenue growth rate

Weakabove +10pp/yr
Okay0 to +10pp/yr
Strong0pp/yr or below
Quarterly Consistency

Same question as Earnings Consistency, just zoomed into the last 8 quarters instead of 4 years.

Formula: No formula — counts down-quarters out of the last 4 (year-on-year)

Weak3 or 4 quarters down, or any loss quarter
Okay2 quarters down
Strong0–1 quarters down

The one thing worth remembering

Every single ratio above lands in Strong, Okay, or Weak — same idea, everywhere. No one ratio decides whether a stock is good; the whole reason there are 21 of them, not 1, is that a company can be genuinely strong on some and genuinely weak on others at the same time. Want the exact formula or threshold behind any of these? See How Scoring Works.

FAQ

Score Your Stock runs all 21 of these on all 1,130 Bursa-listed companies, free — look up Maybank and see every ratio with its real number, or browse every company by sector.

This article is educational content, not investment advice — always do your own research, or speak to a licensed financial adviser, before investing. See About for more on how this site works.