Reference
Glossary
52 terms covering valuation, income, technicals, macro, and Ghana-specific market structure. Every entry is educational — Nkosuo does not publish buy / sell / hold calls or price targets. For a deeper walk-through of any term, open /methodology or ask Nkosuo (⌘/Ctrl-J).
52 of 52 terms.
Valuation
P/E ratio
Price-to-earnings = current share price ÷ trailing-twelve-month EPS. A P/E of 12 means investors pay GHS 12 for every GHS 1 of annual earnings.
Example: MTNGH at GHS 2.45 with TTM EPS of GHS 0.28 → P/E ≈ 8.8.
Related: Forward P/E · PEG · Earnings yield
Forward P/E
Same as P/E, but using next-year forecast EPS. Cheaper-looking forward P/Es can simply mean analysts are projecting growth — verify the assumption.
Related: P/E ratio
PEG
P/E divided by 5-year EPS growth percent. PEG < 1 historically suggested value relative to growth, but reads poorly in low- or negative-growth contexts.
Related: P/E ratio
P/B ratio
Price-to-book = price ÷ book value per share. Below 1 means market values the company below accounting equity. Banks are often valued on P/B because their assets are mostly liquid.
Related: Book value · ROE
P/S ratio
Price-to-sales = market cap ÷ TTM revenue. Useful when earnings are negative or volatile.
Related: P/E ratio
EV/EBITDA
Enterprise value ÷ earnings before interest, tax, depreciation, amortisation. Capital-structure-neutral, so it's a common cross-border comparison metric.
Example: EV = market cap + total debt − cash.
Related: Enterprise value · EBITDA
EV/Sales
Enterprise value ÷ TTM revenue. Useful for unprofitable or capital-light businesses.
Related: Enterprise value · P/S ratio
Enterprise value
EV = market cap + total debt − cash. The headline price a hypothetical acquirer would pay to own the operating business outright.
Related: EV/EBITDA
DCF
Discounted cash flow projects future free cash flows and discounts them to today at a required return. Hyper-sensitive to terminal-growth and discount-rate assumptions, especially in a high-rate market like Ghana.
Related: DDM · Required return
DDM
Dividend Discount Model (Gordon Growth) values a share as next year's dividend ÷ (required return − dividend growth). Only works when growth < required return.
Related: DCF · Dividend yield
Earnings yield
1 ÷ P/E, expressed as a percent. Lets you compare equities to T-Bill yields directly. P/E 12 → earnings yield ≈ 8.3%.
Related: P/E ratio · T-Bill yield
Income
Dividend yield
Trailing 12-month dividend per share ÷ current price × 100. A yield of 8% means GHS 8 of dividends per GHS 100 invested last year.
Example: Compare to the 364-day T-Bill yield to gauge the equity-vs-bills premium.
Related: Payout ratio · Dividend cover
Payout ratio
Dividends ÷ net income (or DPS ÷ EPS). Above 100% means the company is paying out more than it earns — usually unsustainable.
Related: Dividend cover
Dividend cover
EPS ÷ DPS. The inverse of payout ratio. Cover of 2× means earnings are double the dividend, leaving cushion if profits dip.
Related: Payout ratio
Profitability
ROE
Return on equity = net income ÷ shareholders' equity × 100. Banks typically run 15–25% ROE in healthy years.
Related: ROA · ROIC
ROA
Return on assets = net income ÷ total assets × 100. Lower than ROE because it doesn't strip out debt funding.
Related: ROE
ROIC
Return on invested capital = NOPAT ÷ (debt + equity). ROIC above the cost of capital creates value; ROIC below destroys it.
Related: ROE · WACC
Gross margin
(Revenue − cost of goods sold) ÷ revenue × 100. Measures product-level economics before overhead.
Net margin
Net income ÷ revenue × 100. Shows how much of every cedi of sales becomes profit after every expense.
EBITDA
Earnings before interest, tax, depreciation, amortisation. A proxy for operating cash generation, removing accounting and capital-structure choices.
Related: EV/EBITDA
Free cash flow (FCF)
Operating cash flow minus capital expenditure. The cash actually available to investors after maintenance and growth investment.
Related: FCF yield
Capital structure
Book value
Total assets minus total liabilities — the accounting equity. Per-share book value divides by shares outstanding.
Related: P/B ratio
Debt-to-equity
Total debt ÷ shareholders' equity. Higher means more leverage, which lifts ROE but adds bankruptcy risk in downturns.
Current ratio
Current assets ÷ current liabilities. Below 1 = potentially short on near-term liquidity. Above 2 may indicate idle capital.
Required return
The annual return investors demand to hold a stock given its risk. In Ghana, often anchored to the 364-day T-Bill plus an equity risk premium.
Related: DDM · DCF
WACC
Weighted average cost of capital = blended cost of equity + after-tax cost of debt, weighted by capital weights. The discount rate in DCFs.
Technical
SMA
Simple moving average — unweighted average price over the last N days. Common windows: 20, 50, 200. Price above SMA200 is conventionally an uptrend.
Related: EMA · MACD
EMA
Exponential moving average — weights recent prices more heavily, so it reacts faster than SMA.
Related: SMA · MACD
RSI
Relative Strength Index (14-day) measures recent up-day momentum on a 0–100 scale. Above 70 is conventionally 'overbought', below 30 'oversold'. Treat with caution on thinly-traded GSE stocks.
MACD
Moving-average convergence/divergence = 12-period EMA − 26-period EMA, plotted with a 9-period signal line.
Related: EMA
Bollinger bands
A 20-day moving average flanked by ±2 standard-deviation bands. Width tracks volatility; price near the upper/lower band signals stretched moves.
Macro
Monetary Policy Rate (MPR)
Rate at which Bank of Ghana lends to commercial banks. Set by the Monetary Policy Committee every ~8 weeks. Anchors T-Bill yields and lending rates.
CPI
Consumer Price Index — the cost of a basket of household goods. Year-on-year change is headline inflation. Published monthly by Ghana Statistical Service.
Real return
Return after inflation. Fisher: real ≈ (1 + nominal) ÷ (1 + inflation) − 1. With double-digit Ghana CPI, a 20% nominal can shrink to a low single-digit real.
Cedi depreciation
Annual percent fall of GHS vs USD. Affects imported inflation and the USD-translated return on cedi assets for diaspora investors.
Markets
ETF
Exchange-traded fund — a basket of securities, usually tracking an index, that trades like a stock. For Ghanaian investors, most ETFs are USD-denominated, so FX risk applies.
IPO
Initial Public Offering — the first sale of a company's shares to public investors. Ghana examples include MTN Ghana (2018) and several bank rights issues.
Market capitalisation
Current share price × total shares outstanding. The market's valuation of the entire equity base.
Liquidity
How easily you can buy/sell without moving the price. Measured by daily volume, bid-ask spread, and frequency of trading. Many GSE names are thinly-traded — limit orders are often the right default.
Bid-ask spread
Difference between the highest buy order (bid) and lowest sell order (ask). Wide spreads = thin liquidity = higher friction cost when you trade.
Risk
Beta
Sensitivity of a stock's return to the market's return. Beta > 1 = more volatile than market; < 1 = less. Requires a verified market-index history to compute.
Volatility (annualised)
Annualised standard deviation of daily returns. A 30% vol means roughly two-thirds of yearly outcomes fall within ±30% of the mean.
Drawdown
Peak-to-trough percent fall in a price or portfolio. The biggest drawdown in your data is the maximum drawdown (MDD).
Sharpe ratio
(Return − risk-free rate) ÷ volatility. Excess return per unit of risk. Use the 364-day T-Bill yield as the cedi risk-free benchmark.
Operations
Pre-emption rights
Existing shareholders' right to buy new shares before they're offered to outsiders. Common in Ghanaian rights issues to protect against dilution.
Rights issue
A capital raise where existing shareholders are offered new shares at a discount in proportion to their holding. Several GSE banks have raised this way.
Ex-dividend date
The day a stock starts trading without entitlement to the next declared dividend. Buy on or after, you don't receive the dividend.
Ghana-specific
Withholding tax (Ghana)
Ghana withholds 8% tax at source on dividends paid to resident shareholders. T-Bill interest is taxed at 1% at source. /portfolio applies these in the after-tax view.
Related: Dividend yield · T-Bill yield
GSE Composite Index
Headline benchmark for the Ghana Stock Exchange — tracks all listed ordinary shares. Closed at 14,873.11 on 24 April 2026.
Related: GSE Financial Stocks Index
GSE Financial Stocks Index
Sub-index that tracks listed banks and insurers on the GSE. Useful to isolate financial-sector performance from the broader market.
T-Bill
Short-term sovereign debt issued at weekly Bank of Ghana auctions in 91-, 182-, and 364-day tenors. The discount rate is published; investment yield = discount ÷ (1 − discount × tenor/365).
T-Bill yield
The investment yield (not the discount rate) on a Ghana Treasury Bill. The natural risk-free benchmark for cedi investors.
Related: T-Bill