what are profitability ratios 
profitability ratios are a class of financial metrics that are used to assess a business s ability to generate earnings relative to its revenue operating costs balance sheet assets or shareholders equity over time using data from a specific point in time they are among the most popular metrics used in financial analysis profitability ratios can be a window into the financial performance and health of a business ratios are best used as comparison tools rather than as metrics in isolation profitability ratios can be used along with efficiency ratios which consider how well a company uses its assets internally to generate income as opposed to after cost profits investopedia julie bang