What is the Executive summary of Linamar and Magna using the information provided along with a recommendation of which company to invest in?

Overall, Linamar had a challenging year in 2019, with a decrease in revenue of 2.68%, a gross profit loss of 13.83%, and a significant net income loss of 27.23% (Linamar, 2019). Linamar's financial statements reflect the challenges of the Covid-19 pandemic and labour disruption at General Motors. The company also cites higher construction costs and a soft market in the industrial and agricultural sectors. These challenges would be true for all in the sector. Looking closely at Linamar's balance sheet for 2019, the horizontal analysis shows a decrease in cash of 28.3%, a decrease in accounts and other receivables of 23.1%, and a decrease in inventory of 18.6%; combined, this led to a decrease in total current assets of 20%. This decrease was offset slightly by an increase in income taxes recoverable of 45% and an increase in other current assets of 30%. The horizontal analysis showed a decrease of 7% in total assets, compared to the 20% decrease in current assets mentioned earlier, meaning there was an increase in longer-term assets, such as 6% in long-term receivables, and 4% in property, plant and equipment. Linamar saw a significant decrease in both short and long-term debt, 67% and 24%, respectively, contributing to a decrease of 18% in total liabilities from 2018 to 2019 (Linamar, 2019).Magna Magna saw a small decrease in revenue of 3.42% from 2018 to 2019 and a loss of gross profit of 6.29%. More significantly, Magna realized a decline in net income of 23.13% (Magna International Inc., 2019). During 2019, the entire world experienced the Covid-19 pandemic, and the automotive manufacturing industry was no different. In addition, General Motors, a buyer of Magna products, saw labour disruption and the closure of three factories in a restructure. Magna chose to divest its Fluid Pressure and Controls business, also impacting financial performance (Zacks, 2019). Despite a list of challenges, Magna outperformed others in the industry (Zacks, 2019). Magna had slightly less inventory at the end of 2019 (2.9%) and far fewer investments at the end of 2019 (45%); however, the company had 86.5% more cash and a 23% increase in prepaid expenses, bringing the company's overall assets with only a small variance of 1% less over the previous year. Looking closer at the breakdown of Magna's assets at the end of 2019, cash accounted for 4.9%, accounts receivable 23%, inventory 13% and fixed assets at 32%. Regarding liabilities, accounts payable made up 21.8%, long-term debt was 11.9%, and operating lease financing was 6.2% (Magna, 2019).

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Executive Summary In 2019 both Linamar and Magna faced challenges due to the impact of the Covid19 pandemic and other industryspecific factors Linamar ... View the full answer