Data Analytics/Financial Ratio Analysis This assignment will focus on the comparison between T Mobile and Verizon. Identify each company's weak and/or strong areas of performance. After analysis, if you had $1,000 to purchase stock in either of these companies, which would you choose? Calculate the following in this workbook for both T Mobile and Verizon: Horizontal Analysis to compare trends over time Complete the ratio analysis in the analysis worksheet. 1.Horizontal Analysis of select items highlighted in yellow on the statements page. 2. Current ratio - this examines a company's liquidity 3. Debt ratio (Total Liabilities/Total Assets) - This examines the capital structure of a company 4. Total asset turnover ratio - This examines a company's efficiency 5. Net profit margin (net income / net revenue) - This is a profitability ratio 6. Return on Equity - This is also a profitability ratio Complete all yellow highlighted cells in both the statement and the analysis sheet. However, you may complete more if you think it would help in your analysis Upon completion of the above, in which company would you invest your $1,000? Why? Use your analysis to support your choice. (All dollar amounts are in millions) (All dollar amounts are in millions) Verizon Income Statement T Mobile Income Statement Years Ended Dec 31 2021 2020 2019 2018 2021 Years Ended Dec 31 2020 2019 2018 Operating Revenues Revenue Service Revenue $ 110,449 S 109,872 $ 110,305 $ 108,605 Service Revenue $ 58,369 $ 50,395 $ 34,500 S 32,441 Wire equipment revenue $ 23,164 S 18,420 $ 21,563 $ 22,258 Equipment Revenue $ 20,727 S 17,312 S 9,840 $ 10,009 Other $ 1,022 $ 690 S 658 $ 860 Total Net Revenue S 133,613 S 128,292 $ 131,868 S 130,863 Total Net Revenue 80,118 $ 68,397 S 44,998 S 43,310 Cost of Revenues Cost of Revenue Cost of Services S 31,234 S 31,401 $ 31,772 S 32,185 Cost of Services S 13,934 $ 11,878 S 6,622 $ 6,307 Cost of Equipment $ 25,067 $ 19,800 $ 22,954 S 23,323 Cost of Equipment $ 22,671 S 16,388 S 11,899 $ 12,047 Total Cost of Rvenue $ 56,301 $ 51,201 S 54,726 S 55,508 Gross Margin $ 77,312 77,091 $ 77,142 $ 75,355 Total Cost of Revenue Gross Margin $ 36,605 S $ 43,513 $ 28,266 40,131 S 18,521 $ 18,354 $ 26,477 $ 24,956 Operating Expenses Operating Expenses Selling, general, and admin $ 28,658 $ 31,573 $ 29,896 $ 31,083 Selling, general, and admin $ 20,238 $ 18,926 $ 14,139 $ 13,161 Depreciation & Amortization $ 16,206 $ 16,720 $ 16,682 $ 17,403 Impairment expense S S 418 S S Media goodwill impairment $ $ 186 $ 4,591 Depreciation and Amortization $ 16,383 $ 14,151 S 6,616 $ 6,486 Total Operating Expenses $ 44,864 S 48,293 $ 46,764 S 53,077 Total Operating Expenses $ 36,621 $ 33,495 $ 20,755 $ 19,647 Operating Income S 32,448 S 28,798 S 30,378 S 22,278 Operating Income S 6,892 S 6,636 S 5,722 S 5,309 Equity in Losses of unconsolidated business $ 145 $ (45) $ (15) $ (186) Interest Expense $ (3,189) $ (2,483) S (727) $ (835) Other Income (expense) S 312 S (539) S (2,900) $ 2,364 Interest expense to affiliates $ (173) $ (247) S (408) S (522) Interest Expense $ (3,485) $ (4,247) $ (4,730) $ (4,833) Interest income $ 20 $ 29 S 24 S 19 Other expenses $ (199) $ (405) $ (8) S (54) Income before Taxes Provision for Taxes Net Income EPS (Earnings Per Share) 29,420 (6,802) 22,618 5.32 www 23,967 $ 22,733 $ 19,623 Income before Taxes $ 3,351 $ 3,530 $ 4,603 S 3,917 (5,619) $ (2,945) S (3,584) Provision for Taxes S (327) $ (786) $ (1,135) $ (1,029) S 18,348 S 19,788 S 16,039 Net Income from continuing ops S 3,024 S 2,744 S 3,468 $ 2,888 $ 4.30 $ 4.65 3.76 EPS (Earnings Per Share) S 2.42 S 2.68 4.06 $ 3.40 Verizon Balance Sheet 2021 2020 T Mobile Balance Sheet 2019 2021 2020 2019 Current Assets Cash 2,921 $ 22,171 S 2,594 Current Assets Cash S 6,631 S 10,385 1,528 A/R (net) $ 23,846 $ 23,917 25,429 A/R (net) $ 4,167 S 4,254 $ 1,888 Inventories $ 3,055 S 1,796 S 1,422 Equipment receivables $ 4,748 $ 3,577 $ 2,600 Prepaid Expenses $ 6,906 $ 6,710 $ 8,028 A/R from affiliates Inventory $ 27 $ 22 $ 20 $ 2,567 $ 2,527 $ 964 Prepaid Expenses $ 746 $ 624 $ 333 Other current assets $ 2,005 $ 2,496 $ 1,972 Total Current Assets S 36,728 S 54,594 $ 37,473 Total Current Assets S 20,891 S 23,885 S 9,305 Non-Current Assets Non-Current Assets PP&E (net) $ 99,696 S 94,833 $ 91,915 PP & E (net) $ 39,803 $ 41,175 $ 21,984 Investments in unconsolidated businesses $ 1,061 S 589 S 558 Operating Lease $ 26,959 S 28,021 S 10,933 Wireless Licenses $ 147,619 S 96,097 $ 95,059 Financing right of use assets $ 3,322 $ 3,028 $ 2,715 Goodwill $ 28,603 S 24,773 $ 24,389 Goodwill $ 12,188 S 11,117 $ 1,930 Other Intangibles $ 11,677 $ 9,413 S 9,498 Spectrum licenses $ 92,606 $ 82,828 36,465 Operating Leases $ 27,883 $ 22,531 $ 22,694 Other Intangibles $ 4,733 $ 5,298 $ 115 Other assets Total non-current Total Assets S 13,329 S 13,651 $ 10.141 Equipment receivables $ 2,829 $ 2,031 $ 1,583 Other assets S 3,232 $ 2,779 $ 1,891 S 329,868 $ 261,887 $ 254,254 Total non-current assets $ 185,672 S 176,277 $ 77,616 $ 366,596 $ 316,481 $ 291,727 $ 206,563 $ 200,162 $ 86,921 Current Liabilities Current portion of debt S 7,443 S 5,889 S 10,777 Accounts payable $ 24,833 S 20,658 $ 21,806 Current operating lease liabilities $ 3,859 $ 3,485 $ 3,261 Other current liabilities $ 11,025 S 9,628 $ 9,024 Total Assets Current Liabilities Accounts Payable Payables to Affiliates S 11,405 S 10,196 S 6,746 $ 103 S 157 $ 187 Short-term Debt $ 5,623 S 4,579 S 25 Deferred revenue S 856 S 1,030 631 Short-term Operating Lease $ 3,425 $ 3,868 $ 2,287 Short-term financing lease S 1,120 $ 1,063 $ 957 Total current liabilities S 47,160 S 39,660 S 44,868 Other current liabilities Total current Liabilities $ 967 $ 810 $ 1,673 S 23,499 $ 21,703 $ 12,506 Non-Current Liabilities $ 236,236 S Total Liabilities $ 283,396 $ 207,549 247,209 184,024 Non-Current Liabilities Total Liabilities $ 113,962 $ 113,115 $ 45,626 $ 137,461 $ 134,818 $ 58,132 $ 228,892 Equity Equity Common Stock $ $ $ Preferred Stock $ S Additional Paid in Capital S 73,292 $ 72,772 $ 38,498 Common Stock $ 429 S 429 $ 429 Treasury Stock $ (13) $ (11) $ (8) Additional Paid in Capital $ 13,861 S 13,404 S 13,419 AOCI or loss $ (1,365) $ (1,581) S (868) Retained Earnings $ 71,993 $ 60,464 53,147 Accumulated Deficit (R/E) (2,812) $ (5,836) $ (8,833) AOCI or loss $ (927) $ (71) $ Treasury Stock S (4,104) S (6,719) S (6,820) Deferred Compensation $ 538 $ 335 $ 222 Noncontrolling Interest $ 1,410 $ 1,430 S 1,440 Total Equity $ 83,200 $ 69,272 $ 62,835 Total Equity $ 69,102 $ 65,344 $ 28,789 Total Liabilities Plus Equity S 366,596 S 316,481 $ 291,727 Total Liabilities Plus Equity $ 206,563 S 200,162 S 86,921 Verizon Cash Flow Cash Flow 2021 2020 2019 2018 2021 2020 2019 2018 Cash from Operating Activities $ 39,539 $ 41,768 $ 35,746 S 34,339 Cash From Investing Activities $ (67,153) $ (23,512) $ (17,581) $ (17,934) Cash from Financing Activities Increase in Cash S 8,277 $ 1,325 $ (18,164) $ (15,377) $ (19,337) S 19,581 $ 1 $ 1,028 Cash from Operating Activities Cash From Investing Activities Cash from Financing Activities Increase in Cash $ 13,917 $ (19,386) $ 8,640 $ 6,824 $ 3,899 $ (12,715) S (4,125) $ (579) S 1,709 S 13,010 $ (2,374) $ (3,366) S (3,760) $ 8,935 S 325 S (46) Cash at beginning of period $ 23,498 $ 3,917 $ 3,916 S 2,888 Cash at beginning of period $ 10,463 $ 1,528 $ 1,203 $ 1,219 Cash at end of period S 4,161 $ 23,498 S 3,917 S 3,916 Cash at end of period $ 6,703 S 10,463 $ 1,528 S 1,173 Horizontal Analysis Which company trends better for: Verizon T Mobile Sales Growth Net Income Cash Flow Current Ratio Debt Ratio Debt to Equity Ratio Gross Profit Margin Return on Equity EPS Why? For cells B4:C6 above, put an "X" in the appropriate cell to answer the question on which company has the better trend. Verizon 2021 2020 T Mobile 2021 2020 Which company is best in each year 2021 2020 Upon completion of the above, which company would you invest $1,000? Why? Use your analysis to support your choice. Put your answer to the above question here