A balance sheet is a snapshot of what a company owns and what it owes on one day. It always balances: assets = liabilities + shareholders' equity. Here are the pieces that matter for screening.
1. Current assets
Cash and anything expected to turn into cash within a year: receivables (customer bills not yet paid), inventory, short-term investments. Cash is worth what it says. Receivables are usually close. Inventory can be worth much less if it's out of date.
2. Current liabilities
Bills due within a year: suppliers, wages, short-term debt. The current ratio (current assets ÷ current liabilities) shows whether the company can pay them. Graham wanted at least 2.
3. Total liabilities
Everything owed, including long-term debt, leases and pensions. Subtract from current assets and you get net current asset value — the heart of the net-net strategy.
4. Shareholders' equity (book value)
What's left for owners after all debts: assets minus liabilities. Market cap ÷ book value is the P/B ratio. Net income ÷ equity is return on equity, the core of Quality Compounders.
5. Liabilities ÷ assets
A quick measure of leverage. Under 50% is conservative for most industries. Banks and insurers run much higher by design, so compare within an industry.
Where to find them
Every U.S. public company files these with the SEC quarterly (10-Q) and annually (10-K). Our screener reads them straight from those filings every night and does the arithmetic for you — and shows you how it did it.
Educational content, not investment advice. Past performance — of people, papers, or backtests — doesn't guarantee future results. Do your own homework before buying anything.