...Constitution. A key precedent of the Court was established in 1803 through the case of Marbury v. Madison. Since then the Court has ruled on the constitutionality of laws throughout the United States. Two more recent landmark cases are Roe v. Wade and Planned Parenthood of Southeastern Pennsylvania v. Casey. These cases focused on women’s reproductive rights, such as abortion and a state’s rights to restrict abortions based on the constitutional rights. Roe v. Wade took place in the early 1970’s. The 1960’s were a time of hippies, peace and “flower power.” Going into the 1970’s women were demanding respect and equal rights. (“Roe v. Wade.” United States History) Norma McCorvey, also known as...
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...Our talk is divided into 2 main parts: Ratio and Cash flow analysis. Firstly I will talk about how to measure and decompose ROE. Then Anuar and Kostas will look at another concepts of Ratio analysis and finally Min Xe going to explain cash flow analysis. And we will be glad to answer any questions that you may have at the end or during our presentation. Financial analysis is the examination of a business from a variety of perspectives in order to fully understand the financial situation and determine how best to strengthen the business. Financial involves examining historical data to gain information about the current and future financial health of a company. When looking at a specific company, the financial analyst will often focus on the income statement, balance sheet, and cash flow statement. There are two main tools of financial analysis: ratio analysis and cash flow analysis. Ratio analyses is used to evaluate relationships among financial statement items. it is Single and the most important technique of financial analysis in which quantities are converted into ratios for meaningful comparisons, with past ratios and ratios of other firms in the same or different industries. Ratio analysis determines trends and exposes strengths or weaknesses of a firm. Cash flow analysis - An examination of a company's cash inflows and outflows during a specific period. The analysis begins with a starting balance and generates an ending balance after accounting for all cash receipts and...
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...DuPont Analysis DuPont analysis helps in identifying the source of profitability. The DuPont analysis breaks up ROA into 2 components: ROA = Asset turnover*Operating profit margin Taking ROA as (EBIT-Tax)/assets and multiplying and dividing by sales, we get (sales/assets)*((EBIT-Tax/sales)) Similarly it breaks up ROE into 3 components: ROE = Net profit margin* Asset Turnover * Equity multiplier This can also be written as: ROE = Profitability*Efficiency*Leverage The Three-Step DuPont Calculation: Taking the ROE equation: ROE = net income / shareholder's equity and multiplying the equation by (sales / sales) we get: ROE = (net income / sales) * (sales / shareholder's equity) We now have ROE broken into two components, the first is net profit margin, and the second is the equity turnover ratio. Now by multiplying in (assets / assets), we end up with the three-step DuPont identity: ROE = (net income / sales) * (sales / assets) * (assets / shareholder's equity) This equation for ROE breaks it into three widely used and studied components: ROE = (Net profit margin)* (Asset Turnover) * (Equity multiplier) Return on Total Asset Analysis | Company | March'15 | March'14 | March'13 | March'12 | March'11 | Bharti Airtel | 2.74 | 1.62 | 1.44 | 2.81 | 1.54 | Reliance Communications | 0.79 | 1.16 | 0.74 | 0.99 | 1.44 | Idea Cellular | 5.97 | 4.75 | 2.93 | 2.30 | 3.35 | Return on Equity Analysis | Company | March'15 | March'14 | March'13 | March'12...
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...Financial Statement Analysis Horizontal analysis Vertical analysis Ratio Analysis DuPont Equation Effects of Improving Ratios Limitations of Ratio Analysis Qualitative Factors Comparative Balance Sheet: Vertical Analysis Comparative Balance Sheet: Vertical Analysis Income Statement: Vertical Analysis Comparative Balance Sheet: Horizontal Analysis Comparative Balance Sheet: Horizontal Analysis Income Statement :Horizontal Analysis Balance Sheet: Assets Cash A/R Inventories Total CA Gross FA Less: Deprec. Net FA Total Assets 2012E 85,632 878,000 1,716,480 2,680,112 1,197,160 380,120 817,040 3,497,152 2011 7,282 632,160 1,287,360 1,926,802 1,202,950 263,160 939,790 2,866,592 Balance Sheet: Liabilities and Equity Accts payable Notes payable Accruals Total CL Long-term debt Common stock Retained earnings Total Equity Total L & E 2012E 436,800 300,000 408,000 1,144,800 400,000 1,721,176 231,176 1,952,352 3,497,152 2011 524,160 636,808 489,600 1,650,568 723,432 460,000 32,592 492,592 2,866,592 Income Statement Sales COGS Other expenses EBITDA Deprec. & amort. EBIT Interest exp. EBT Taxes Net income 2012E 7,035,600 5,875,992 550,000 609,608 116,960 492,648 70,008 422,640 169,056 253,584 2011 6,034,000 5,528,000 519,988 (13,988) 116,960 (130,948) 136,012 (266,960) (106,784) (160,176) Other Data No. of shares EPS DPS Stock price Lease pmts 2012E 250,000 $1.014 $0.220 $12.17 $40,000 2011 100,000 -$1.602 $0.110 $2.25 $40,000 Why are ratios useful? Ratios standardize...
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...FINANCIAL ANALYTICAL TOOLS Financial analysis involves evaluating the current financial statements of an organization in order to access the current profitability and also compare same with past performance (time series analysis) and the performance of other players within the industry. In other words, analyzing the financial statements assesses the financial health of a company. The major statistical tools used in financial analysis are ; • Ratio Analysis • Cash Flow Analysis • Common Size Analysis Ratio Analysis Investopedia describes ratio analysis as , ‘A tool used by individuals to conduct a quantitative analysis of information in a company's financial statements’. Ratio Analysis can be viewed along the following lines; • Liquidity Ratios • Profitability ratios • Debt ratios • Operating performance ratios • Cash flow indicator ratios • Investment Valuation ratios In reviewing the liquidity ratios, the current ratio, also known as working capital ratio, is used to calculate the proportion of current assets that is available to cover current liabilities, the formula can be calculated as Current Ratio = Current Assets Current Liabilities Its limitation however rests in the fact that in assessing liquidity, it assumes all the company’s assets will be liquidated to cover this and no indication has been given to the amount of time required to liquidate these current considering an organization is a going concern and as such the key to liquidity...
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...Chapter 3 Analyzing Financial Statement Five major areas to analyze. (1) (2) (3) (4) (5) (1) a) Liquidity Position Management of Assets Management of Debt Company's Profitability Market's View of Company Liquidity Ratios - use to investigate the relationship between a firm's current (shortterm) assets and current (short-term) liabilities. Current Ratio = Current Assets Current Liabilities Current Assets - Inventory Current Liabilities Cash + Marketable Securities Current Liabilities b) Quick Ratio (Acid-test) Cash Ratio = c) = (2) Asset Management Ratios - Use to evaluate how efficiently management employs assets. Inventory Management a) b) Inventory Turnover Days’ Sales in Inventory = = Cost of Goods Sold (or Sales) Inventory Inventory Average Sales/day Accounts Receivable Management a) Average Collection = Period (ACP) Accounts Receivable Turnover = Accounts Receivable Average Sales/day Sales Accounts Receivable b) Accounts Payable Management a) Average Payment = Period (APP) Accounts Payable Turnover = Accounts Payable Cost of Goods Sold / day Cost of Goods Sold Accounts Payable b) Fixed Asset and Working Capital Management a) b) Fixed Asset Turnover Sales to Working Capital = Sales Net Fixed Assets Sales Net Working Capital = Total Asset Management a) b) Total Asset Turnover Capital Intensity = = Sales Total Assets Total Assets Sales (3) Debt Ratios - use to evaluate riskiness of company (remember higher risk equates to higher...
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...Expected return for a Security = | Expected Risk for a security = | Beta β = | Sharpe Ratio = | Treynor’s Reward to Volatility Ratio = | Financial Summary * Expected Returns * Trailing P/E Ration * Forwarding P/E Ratio * Dividends Per Share * PEG Ratio * Market Capitalization * Growth in Revenues for the Last 12 Months Risk Measurements * Beta β * Standard Deviation * Sharpe Ratio * Treynor’s Reward to Volatility Ratio Highlights Qualitative Analysis Company Profile Industry Overview SWOT Analysis * Strengths * Weaknesses * Opportunities * Threats Porter’s 5 Competitive Forces I. The threat of substitute products II. The threat of new competitors III. The intensity of competitive rivalry IV. The bargaining power of customers V. The bargaining power of suppliers Management Financial Statement Analysis Financial Ratio Analysis The financial ratios in this report has been computed by using the income statements of Pfizer (PFE) during the fiscal year 2012. The income statements were obtained from the annual report submitted to the Security and Exchange Commission (SEC) website. This report will include the following ratios: Short-term solvency ratios, long-term solvency ratios, turnover ratios, profitability ratios, and market value ratios. These ratios will serve as a guide in determining the company’s position as it relates to performance...
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...MP A R Munich Personal RePEc Archive A critical analysis of Mudarabah & a new approach to equity financing in Islamic finance Shaikh, Salman Ahmed International Association of Islamic Banks 01. July 2011 Online at http://mpra.ub.uni-muenchen.de/19697/ MPRA Paper No. 19697, posted 19. September 2011 / 12:03 A Critical Analysis of Mudarabah & A New Approach to Equity Financing in Islamic Finance Journal of Islamic Banking & Finance, ISSN 1814-8042 By Salman Ahmed Shaikh Project Director, Islamic Economics Project islamiceconomicsproject@gmail.com www.islamiceconomics.viviti.com Abstract Financial intermediation serves a valuable purpose, but it can also be structured using equity modes of financing. This can relieve the financee and increase diversity of entrepreneurial undertakings as in debt based commercial financing, there is little room for diversity with obligatory and stipulated servicing of debt. Using Islamic equity modes of financing poses the challenge of the agency problem and moral hazard. The extent of this agency problem in Mudarabah and its impact on economic payoffs between counterparties is analyzed in this study with a simulation model. Based on review of alternate solutions proposed, the author presents two possible covenants which could make Mudarabah mode of financing more acceptable and widely usable in financial intermediation. This would also further the egalitarian objectives of an Islamic economic order. Keywords: Interest free economy, Islamic...
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...Annales Universitatis Apulensis Series Oeconomica, 15(2), 2013, 594-604 ANALYSIS OF THE ROMANIAN BANKS’ PERFORMANCE THROUGH ROA, ROE AND NON-PERFORMING LOANS MODELS Adela Socol1 Adina Elena Dănuleţiu2 ABSTRACT: General assumption of this study is that the banks performance represents their ability to generate sustainable profitability and that banks’ profitability is one important issue of contemporary banking field, grace to its role in emphasizing of the financial soundness of banks, abreast to others indicators regarding to the capital adequacy or assets quality. The paper examines how is affected banking profitability (expressed through traditional measures of performance ROA - Return on Assets and ROE - Return on Equity) by the CRR Credit risk ratio in Romanian banking system during March 2008 - June 2013. We developed two regression models in order to study the dependence between mentioned variables. We found that ROA and ROE vary each of them depending on the CRR Credit risk ratio, which is expressed as the ratio of gross value of exposure to loans and related interest under “doubtful” and “loss” to total classified loans and related interest pertaining to non-bank loans, off-balance sheet items excluded. Keywords: ROA Return on Assets, ROE - Return on Equity, Credit risk ratio, Regression model JEL Codes: D12, C58, G21 Introduction Significant level of non-performing loans and faster cross-border deleveraging are considered the major weaknesses...
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...“Analysis of AT&T’s Stock” FIN560 - Securities Analysis Index 1. The background of the company 2. AT&T’s Life Cycle Analysis 3. Analysis of Return on Equity 4. The company's projected future growth rate of earnings 5. Analysis of its required rate of return using the CAPM measurement 6. The company’s intrinsic value using the discount valuation techniques 7. Conclusions 8. References 1. AT&T Background AT&T Inc. is an American multinational corporation that provides telecommunications services to consumers, businesses, and other providers worldwide. Founded in 1983 as SBC Communications Inc. and changed its name to AT&T Inc. in November 2005, is considered the leading company in the telecommunication industry by Fortune 500 ranked as the number 11th; Headquartered in Dallas, Texas AT&T Inc. has 256,420 employees. AT&T Inc. common stock is listed on the New York Stock Exchange under the symbol of “T” (NYSE: T) making the company one of the 30 stocks that make up the Dow Jones Industrial Average. It is also a Fortune 500 company ranked the largest communications holding company in the world by revenue of $126,723 millions and by profits $3,944 according to the latest results in 2012. Its direct competitor is Verizon Communications with $110,875 millions in revenue and $2,404 millions in profits, 20% bellow of AT&T. According to its 2011 Annual Report, the company has invested...
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... Through their financial statements…Let me show you how… FINANCIAL HEALTH OF THE COMPANIES Increasing PAT & Sales Revenue for both the companies. Retirement of secured loan by both the companies. ₹ 90,926 Million (2014) Sales Revenue 8% ₹ 84576 Million (2013) ₹ 73780 Million (2014) Total Cost 7% ₹ 68783 Million (2013) ₹ 15008 Million (2014) PAT 3% ₹ 14598 Million (2013) Financial Highlights of B/S Sales 133% Investments Revenue ₹ 63548 Million (2014) 12% ₹ 56811 Million (2013) ₹ 58066 Million (2014) Highlights of B/S 33% Investments 216% Cash Total Cost 9% ₹ 53111 Million (2013) ₹ 3654 Million (2014) 30% Receivables Secured Loan -15% PAT Secured Loan 53% ₹ 2393 Million (2013) -100% CASH FLOW ANALYSIS Britannia is concentrating more on investment than Nestle. ₹ 17964 Million (2014) Operating Activities 6% ₹ 16933 Million (2013) ₹ (9408) Million (2013) Decrease in cash outflow from Investing activities company is investing less Less expansion plans ₹ 6145 Million (2014) Operating Activities 126% ₹ 2720 Million (2013) ₹ -2273 Million (2014) Investing 522% Activities ₹ 539 Million (2013) ₹ (3591) Million (2013) Increase in cash outflow from Investing activities company is investing more More expansion plans High future growth Increase in profits Increase in cash flow from operating Investing Activities 53% ₹ (4409) Million (2014) ₹ (5801) Million (2014) Financing Financing 13% ₹ (5131) Million (2013)...
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...AT&T Stock Analysis Masters of Business Administration Keller Graduate School of Management, 2013 Spring Semester Keller Graduate School of Management Online Table of Contents 1.0 Face Page……………………………………………………………………………….1 2.0 Table of Contents……………………………………………………………………….2 3.0 Introduction………………………………………………………………………….….3 4.0 Company’s Background. ……………………………………………………………….4 5.0 Life Cycle Analysis……………………………………………………………………..4 6.0 An Analysis of Return on Equity……………………………………………………….5 7.0 Projected Future Growth Rate of Earnings……………………………………………..6 8.0 Analysis of Required Rate of Return –CAPM………………………………………….7 9.0 Intrinsic Value (DVT)…………………………………………………………………..8 10.0 Conclusion/Recommendation……………………………………………………..........8 11.0 References………………………………………………………………………………9 3.0 Introduction This literature review seeks to investigate and apply technical analysis measurements AT&T stock that trades on the New York Stock Exchange. With this data then the author will make a buy/sell recommendation. Understanding the importance of Stock analysis and its influence on AT & T Company failures or successes drives this study. AT &T is the leading communications company in the world by revenue. Also, they are the nation largest 4G networks, covering 275 million people. AT&T not only offers innovative smartphones, but AT&T U-verse TV and...
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...82 Part 2 Fundamental Concepts in Financial Management Table IC 3-3 Statement of Stockholders’ Equity, 2008 COMMON STOCK Shares Amount $460,000 Retained Earnings $ 203,768 (160,176) (11,000) (171,176) $ 32,592 Total Stockholders’ Equity $663,768 Balances, 12/31/07 2008 Net Income Cash Dividends Addition (Subtraction) to Retained Earnings Balances, 12/31/08 100,000 100,000 $460,000 (171,176) $492,592 Table IC 3-4 Statement of Cash Flows, 2008 ($160,176) 116,960 378,560 353,600 (280,960) (572,160) ($164,176) Operating Activities Net income Depreciation and amortization Increase in accounts payable Increase in accruals Increase in accounts receivable Increase in inventories Net cash provided by operating activities Long-Term Investing Activities Additions to property, plant, and equipment Net cash used in investing activities Financing Activities Increase in notes payable Increase in long-term debt Payment of cash dividends Net cash provided by financing activities Summary Net decrease in cash Cash at beginning of year Cash at end of year ($711,950) ($711,950) $436,808 400,000 (11,000) $825,808 ($ 50,318) 57,600 $ 7,282 Chapter 3 Financial Statements, Cash Flow, and Taxes 83 Access the Thomson ONE problems through the CengageNOW™ web site. Use the Thomson ONE—Business School Edition online database to answer this chapter’s questions. Exploring Starbucks’ Financial Statements Over the past decade, Starbucks coffee shops have become...
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...Dupont Analysis Kellogg Co. Net Income =352 millions Total Assets = 15.1 billions Equity = 2.56 billions Net Sales = 14197 millions ROE = 13.75% ROA = 2.3% ROS = 24.79% Equity Multiplier = 5.98 Total Asset Turnover = .00094 General Mills Net Sales = 17774.1 millions Total Assets = 22.7 billions Net Income = 366300 millions Equity = 6.67 billions ROE = 5.4% ROA = 1.6% ROS = 20.61% Equity Multiplier = 3.38 Total Asset Turnover = .00078 Kellogg Co. has a higher return on their assets, thus we see a higher total asset turnover than General Mills. The total asset turnover measures the company's ability to generate sales with the assets it has. Kellogg's ROE is 5.98 times its ROA because of its use of other people's money. When we look at General Mills ROE is lower than Kelloggs Co. ROE, their ROE is only 3.38 times their ROA, showing that they are using less of other peoples money. In my opinion, General Mills. is operating better than Kellogg's. The analysis shows a more effective use of assets by General Mills, and we can see the results in the net income. General Mills has more sales, thus producing more income. Common Size Income Statement Analysis General Mills Sales |17774B |100.00% | |COGS |10.74B |60.00% | |Gross Income |6.45B |36.00% | |Taxes |741.2M |4.20% | |Net Income |366,300B |21.00% | | Kelloggs Sales |14.2 B |100.00% | |COGS |8.45B |60.00% | |Gross Income |5.74B |40.00% | |Taxes |363M...
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...Summary Comparing different companies under different rules, or comparing one company in different time period can be complicating and often misleading when differences in accounting methods are not captured. In this essay, I will start the analysis by examining each firm’s change in accounting methods compared to their previous year. Then I will move on to comparing the three companies’ ratios to conduct analysis of each company based on the DuPont Method. In addition, I will also look at how changes in accounting methods affected Seven and I holdings’ results in 2013 when compared to 2012. Finally, I will conclude my analysis on how comparable it was under different accounting methods based on above analysis. _____ Three Companies Chosen for Analysis For this ratio analysis assignment, I chose three companies from the UK, US and Japan: Walmart Country: US Industry: Supermarket Retail Accounting Standard: GAAP TESCO Country: UK Industry: Supermarket Retail Accounting Standard: IFRS Seven and I Holdings Country: Japan Industry: Supermarket Retail Accounting Standard: Japan Standard _____ Change/Amendments in Accounting Methods Walmart Even though there is a mention about recent accounting pronouncements and future adoption of those policies, there is and will be no effect in the firm’s net income, financial position or cash flows. Sainsbury Although there were two amendments effective from this annual reports, the firm has concluded...
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