What is trailing 12 months

Companies report their income statements on a monthly, quarterly, or annual basis. The process for generating a trailing twelve months figure for each item in the income statement will depend on the available reports. For income statements that report monthly, simply add the values of your revenue, expenses, and profits for each month during the last 12 months, using the following formula:.

For quarterly reporting, take the last four quarterly values and add them together, as follows:. There is an alternative method to calculate TTM for income statements. Ultimately, you can calculate TTM the same way as the income statement, adding monthly or quarterly figures to get the previous 12 months of data. For example, figures from Q1 of plus the annual numbers from less the figures from Q1 of will give you the trailing twelve months data from April 1, , to March 31, A balance sheet is typically compared to the balance sheet data from one year ago.

These numbers will represent the last twelve months of balance sheet data. The trailing twelve months method is essential because it provides companies with detailed, recent financial data for internal audits, financial analysis, and corporate planning.

TTM is useful for evaluating revenue growth, margins, sales and expense trends, working capital management, key performance indicators KPIs , and other financial metrics. TTM is useful as a clear standard, since sometimes firms will provide monthly statements detailing sales volumes or performance indicators, whereas Securities and Exchange Commission SEC filings present quarterly or YTD financials. Rebecca Baldridge, CFA, is an investment professional and financial writer with over twenty years of experience in the financial services industry.

She is a founding partner in Quartet Communications, a financial communications and content creation firm. With two decades of business and finance journalism experience, Ben has covered breaking market news, written on equity markets for Investopedia, and edited personal finance content for Bankrate and LendingTree.

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Featured Partners. Annual advisory fee None. Annual advisory fee 0. TTM numbers are always completely up-to-date. They take factors such as high sales during the holiday season into effect and smooth out any seasonal effects. For this reason, many financial analysts pay more attention to this metric than the annual statements that a company files with the SEC. Stay on top of new content from Divestopedia.

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Financial Ratios Guide to Financial Ratios. Key Takeaways Trailing 12 months TTM is the term for the data from the past 12 consecutive months used for reporting financial figures. A company's trailing 12 months represent its financial performance for a month period; it does not typically represent a fiscal-year ending period.

The last 12 consecutive months provides investors with a compromise that is both current and seasonally adjusted. Compare Accounts. The offers that appear in this table are from partnerships from which Investopedia receives compensation. This compensation may impact how and where listings appear. Investopedia does not include all offers available in the marketplace.

Related Terms Rolling Returns Rolling returns are annualized average returns for a period, ending with the listed year. Reading Financial Performance Financial performance measures how well a firm uses assets from operations and generates revenues. Read how to analyze financial performance before investing.

Dividend Yield; Formula and Calculation The dividend yield is a financial ratio that shows how much a company pays out in dividends each year relative to its stock price.

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