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Fairfax and New Corp

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Submitted By vietnamn6
Words 1926
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Fairfax Media Limited (FXJ) and News Corporation are two media companies, the former is an Australasia's leading media company while the latter one is an American company, which is on a larger scale than Fairfax Media.
Good investors must have their own analysis and their own decision. In order to know which company is worth to invest in, we analyse the finance statements of these two companies throughout the three - year period, from 2007 to 2009 by comparing the financial ratios, evaluating the red flags, identifying non-financial information, analysing Notes to the financial statements.

1. Trend Analyses and Financial Ratio Analyses over Three - year Period, from 2007 to 2009.

Company Financial ratio 2009 2008 2007 Profitability Return on investment (ROI) (%) N/A 7.8 5.3 Gross margin (%) 19.3 27.6 23.5 Liquidity Working capital (%) 79.4 127.9 171.5 Quick ratios (%) 73.2 119.2 161.4
Fairfax Leverage Leverage ratio (%) 38.1 50.6 47.3
Media Interest cover (times) N/A 3.8 4.0 Efficiency Asset Turnover (%) 34.2 35.0 26.4 Inventory turnover (times) 49.5 45.0 38.4 Shareholder Dividend per share (cents) 2.0 20.0 20.0 Return Earnings per share (cents) N/A 22.9 22.7 Profitability Return on investment (ROI) (%) N/A 18.8 10.4 Gross margin (%) 35.9 37.8 34.9 Liquidity Working capital (%) 148.8 156.4 212.2 Quick ratios (%) 125.6 131.9 185.0
News Leverage Leverage ratio (%) 34.4 31.6 27.0
Corp Interest cover (times) N/A 8.9 6.6 Efficiency Asset Turnover (%) 57.3 53.0 46.0 Inventory turnover (times) 8.3 9.6 9.6 Shareholder Dividend per share (cents) 0.12 0.12 0.11 Return Earnings per share (cents) N/A 1.8 0.7

1.1- Profitability
Return on shareholders’

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