Final answer:
To determine a company's returns, one needs to consider financial statements, key financial ratios, industry comparisons, and historical data.
Step-by-step explanation:
In order to determine if a company's returns are strong, weak, or somewhere in between, several pieces of information are needed. These include:
- Financial Statements: A company's financial statements, such as the income statement, balance sheet, and cash flow statement, provide valuable information about its profitability, liquidity, and overall financial health.
- Key Financial Ratios: Ratios such as return on equity (ROE), return on assets (ROA), and gross profit margin can help assess a company's profitability and efficiency.
- Industry Comparison: It's important to compare a company's returns to those of its competitors within the same industry to get a better understanding of its performance.
- Historical Data: Analyzing a company's returns over time can help identify trends and patterns.
By considering these factors, investors and analysts can make more informed judgments about a company's returns.