How to Read Company Financial Statements (UK)

Learning how to read financial statements is the difference between buying a story and buying a business.

The three core statements (income statement, balance sheet, cash flow) each tell you something the others hide.

Five ratios do most of the work: ROE, debt-to-equity, operating margin, free cash flow yield, and interest cover.

Buffett-style red flags include heavy debt loads, weak gross margins, capex-hungry industries, and no pricing power.