Question: Taiwan Mobile Co . , Ltd . has a moderate liquidity position, comparable to Far EasTone Telecommunications but significantly weaker than Chunghwa Telecom. To improve

Taiwan Mobile Co., Ltd. has a moderate liquidity position, comparable to Far EasTone Telecommunications but significantly weaker than Chunghwa Telecom. To improve its financial resilience, the company should aim to enhance its cash reserves or reduce short-term liabilities, especially to match industry leaders like Chunghwa Telecom.
Taiwan Mobile Co., Ltd. has the highest total debt ratio among its peers, indicating greater financial leverage and risk exposure. While this strategy might enhance returns during periods of growth, it also places the company at greater financial risk compared to Chunghwa Telecoms conservative debt ratio. Taiwan Mobile should consider reducing its reliance on debt to strengthen its financial position and better align with industry norms.
Taiwan Mobile Co., Ltd. demonstrated strong performance in inventory turnover with a ratio of 18.14, indicating efficient inventory management and competitive alignment with industry standards. Far EasTone Telecommunications Co., Ltd. achieved the highest turnover ratio of 20.01, reflecting slightly superior efficiency in inventory movement and cost control, while Chunghwa Telecom Co., Ltd. reported a significantly lower turnover ratio of 10.31, suggesting slower inventory movement and potential risks of overstock or obsolescence.
Taiwan Mobile Co., Ltd. reported a profit margin of 6.69%, the lowest among the three firms, indicating challenges in converting revenue into profit due to higher costs or lower efficiency. Far EasTone Telecommunications Co., Ltd. achieved a profit margin of 11.94%, reflecting moderate profitability and better cost management relative to its revenue. Chunghwa Telecom Co., Ltd. led with a profit margin of 16.69%, demonstrating exceptional efficiency and profitability. Taiwan Mobiles lower performance highlights the need for cost optimization and strategic initiatives to improve profitability and competitiveness compared to its peers.
Taiwan Mobile Co., Ltd.s P/E ratio of 24.36 is slightly lower than its peers, Far EasTone (26.18) and Chunghwa Telecom (26.22). While this may indicate undervaluation, it also reflects lower market expectations or higher perceived risks. Taiwan Mobile can work on enhancing its growth outlook and financial stability to align its valuation with its competitors.
Taiwan Mobile Co., Ltd. achieves the highest ROE (13%) among its peers by effectively leveraging its assets, though its profitability (Profit Margin) is lower. Far EasTone Telecommunications Co., Ltd. has a slightly lower ROE (12%), driven by a stronger Profit Margin but offset by lower Asset Turnover. Chunghwa Telecom Co., Ltd., despite having the strongest Profit Margin and lowest financial risk (low Equity Multiplier), has the lowest ROE (9%) due to its weak Asset Turnover.
State your own analysis about the company that you choose (Taiwan Mobile Co., Ltd.) by using the comprehensive information including the financial statement, the ratio analysis, etc.

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