Currency day trading – A fourth element is the profit-margin trend.
You can calculate this by dividing net profits by sales volume. This is a measure of the company's efficiency. By establishing a ratio between dollars and profit earned, you can see how much the company has had to pay to manufacture, sell, and distribute its products”in other words, the expense involved in acquiring a dollar of sales. If production and sales costs are high, and the sales price is presumably competitive, then profit margins will have to be squeezed. You can plot this over a period of years to see whether the company is increasing its efficiency, but usually it is calculated for the current or past year (depending on the statistics available) in relation to the performance of competing companies or the industry as a whole. Texas Co.
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