Calculate the following ratios for you company and a competitor for two years. Present your calculations in
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Question:
Calculate the following ratios for you company and a competitor for two years. Present your calculations in a table.
Liquidity ratios:
Working Capital Current Assets Current Liabilities
Current Ratio Current Assets : Current Liabilities
Inventory Turnover Ratio Cost of Goods Sold : Average Inventory
Solvency ratios:
DebttoEquity Ratio Total Liabilities : Stockholders' Equity
Profitability ratios:
Net Margin Profit Margin Ratio Net Income : Net Sales
Gross Profit Ratio Gross Profit : Net Sales
Asset Turnover Ratio Net Sales : Average Total Assets
Return on Equity Net Income : Average Total Stockholders' Equity
Stock market ratios:
Earnings per Share Net Earnings : Average number of outstanding common shares
PriceEarnings PE Ratio Market Price Per Share : Earnings Per Share
Your ratio analysis should include one or two paragraphs discussing the performance of your company vs the competitor as shown by the ratios; discuss trends and meanings.
Summarize your analysis of the firm and comment as to whether or not it is a company in which you would invest. Why or why not? The summary and recommendations should be a minimum of three paragraphs detailing your overall evaluation of the company.
Do not shortchange this section. Your summary and conclusions are the most important part of the report! Be thorough!
Section References
List the references used in preparing your report.
Section Secondary Stock Market Activity
Include as an exhibit to your report the daily stock prices for the days preceding the date of your report. Comment on stock prices. In addition to listing the stock prices for days, create a graph to visually display the stock prices.
Related Book For
Financial Accounting Tools for Business Decision Making
ISBN: 978-1118024492
5th Canadian edition
Authors: Paul D. Kimmel, Jerry J. Weygandt, Donald E. Kieso, Barbara Trenholm, Wayne Irvine
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