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Value Line

In: Business and Management

Submitted By godspeed2121
Words 666
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Value Line Publishing,
October 2002

Value Line Publishing is an investment-survey firm. Value Line is best known for publishing The Value Line Investment Survey, a stock analysis newsletter that is updated weekly and kept by subscribers to the print edition in a large black or green binder. The company provides information via an online web page with both free and paid content.

After analyzing the financial ratios in case Exhibit 7 for Home Depot these are the points I detected about the operating performance. Home Depot has an overall profitability given growth in the market compared to sales and liabilities. Operational performance ratios measure how different aspects of a company’s finances are performing. The fixed-asset turnover ratio, operating cycle ratio and revenue per employee ratio each provide a different look into how a company is bringing in revenue, if the business is spending its money well and how efficiently it is using its assets and resources. Analyzing these ratios provides greater insight into the company’s finances than just studying accounting or other financial records.

Furthermore, I would like to start with Home Depot’s five-year average for return on capital (ROC) 15.2%, which shows a positive company profit as a percentage of total company value and ownership; the return on equity (ROE) 16.8%, which indicates a positive combined total worth of the company. On the other hand return on equity was higher from 1998-2000; equity in 1997 was 16.3% therefore if we look at ROE in these terms the increase was not significant, however it was an increase. The ROE for Home Depot in 1998-18.5%, 1999-18.8%, and in 2000-17.2% all show higher increases than in 1997 and 2001.

Home Depot also shows an increase over the five-year average gross margin, which is 31.6%; this number represents the proportion of each dollar of revenue that

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