Ratios formed from various items in a company’s accounts which are used to make comparisons between firms. These include the price–earnings (P/E) ratio, that is the ratio of the market price to earnings per share, and the price–dividend (P/D) ratio, that is the ratio of the market price to the latest dividend paid per share. Financial ratios are used to compare the merits of investing in different companies and as predictors of future company performance.