Valuation Glossary

The solvency ratio is a key financial metric used to measure a company's ability to meet its long-term debt obligations and remain financially healthy over the long term. A higher solvency ratio indicates a stronger ability to meet long-term debts, while a lower ratio may suggest potential financial instability.

A share-based payment is a transaction in which an entity receives goods or services from suppliers or employees as consideration for equity instruments (such as shares or stock options) or incurs a liability to suppliers or employees that is based on the price of the entity's shares.

A share buyback, also known as a stock repurchase, occurs when a company buys back its own shares from the marketplace. Companies may initiate buybacks to return excess cash to shareholders, signal confidence in their own financial health, or to prevent other shareholders from gaining a controlling stake.

Securitization is a financial process where various types of assets, such as loans or receivables, are pooled together and then sold as consolidated financial instruments, typically in the form of bonds, to investors.

The Securities and Exchange Commission (SEC) is a U.S. government agency responsible for regulating the securities markets and protecting investors.