Analyzing a company for its investment potential In its annual
Analyzing a company for its investment potential In its annual report, WRM Athletic Supply, Inc. includes the following five-year financial summary:
Requirements
Analyze the company’s financial summary for the fiscal years 2016–2020 to decide whether to invest in the common stock of WRM. Include the following sections in your analysis, and fully explain your final decision.
1. Trend analysis for net sales and net income (use 2016 as the base year).
2. Profitability analysis.
3. Evaluation of the ability to sell merchandise inventory (WRM uses the LIFO method).
4. Evaluation of the ability to pay debts.
5. Evaluation of dividends.
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