MMoliyaHub

How the score is calculated

The score is a weighted sum of four sub-scores. Each starts from a base value and goes up or down depending on which band a ratio falls into. The result is capped to 0–100.

Liquidity

25 % of the total score

Whether current assets cover short-term debts. Starts at 50.

Current ratio
ConditionPoints
≥ 2+20
≥ 1.5+15
≥ 1.2+8
≥ 1±0
< 1−20
Quick ratio
ConditionPoints
≥ 1+15
≥ 0.7+8
< 0.7−10
Cash ratio
ConditionPoints
≥ 0.2+15
≥ 0.1+5
< 0.1−10

Profitability

30 % of the total score

How much profit assets, equity and sales bring in. Starts at 40.

Return on assets (ROA)
ConditionPoints
≥ 15 %+20
≥ 8 %+12
≥ 3 %+5
< 0 %−25
Return on equity (ROE)
ConditionPoints
≥ 20 %+20
≥ 12 %+12
≥ 5 %+5
< 0 %−20
Return on sales
ConditionPoints
≥ 10 %+10
≥ 5 %+5
< 0 %−15

Stability

25 % of the total score

How far the company relies on its own money rather than debt. Starts at 50.

Equity ratio
ConditionPoints
≥ 0.5+25
≥ 0.4+15
≥ 0.3+5
< 0.3−20
Debt ratio
ConditionPoints
≤ 0.4+15
≤ 0.6+5
> 0.6−15
Working capital
ConditionPoints
> 0+10
≤ 0−15

Efficiency

20 % of the total score

How quickly assets and inventory turn into revenue. Starts at 50.

Asset turnover
ConditionPoints
≥ 1.5+25
≥ 1+15
≥ 0.6+5
< 0.6−10
Inventory turnover
ConditionPoints
≥ 6+25
≥ 4+15
≥ 2+5
< 2−10

What the total means

  • 0–44

    At risk

  • 45–74

    Room to improve

  • 75–100

    Solid position

If a line is missing from the statements and a ratio cannot be computed, it is left out: the score does not penalise an empty field.

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