This note introduces financial ratios and financial forecasting. It examines principles in the art and science of thoughtful financial forecasting. In particular, it reviews the importance of (1) understanding financial ratios, (2) grounding business forecasts, (3) modeling a base-case forecast that incorporates the expectations for business strategy, and (4) recognizing the potential for cognitive bias in the forecasting process. Forecasting is not the same as fortune-telling; unanticipated events have a way of making certain that specific forecasts are never completely correct. This note suggests, however, that thoughtful forecasts aid understanding of the key bets in any forecast and the odds associated with success. It closes with an example of financial forecasting based on the Maytag Corporation, a U.S. appliance manufacturer.