Publicly Financial Analysis of Dell and Apple

¶ … Publicly

FINANCIAL ANALYSIS OF DELL AND APPLE

Current asset ratio

Dell has 1.48 current ratio in 2011 as compared to previous year (1.28) their short-term financial position has improved, which shows that dell is in position to meet its short-term liabilities without any difficulty. On the other hand, apple short-term financial position has fallen from 1.6 to 1.5 but it is still in a position to meet its short-term financial position.

Inventory turnover ratio

Dell has a slow rate to covert its stock into sales (8.25) as compared to Apple, which has a rate of approximately 26.25. Therefore, dell has more funds locked in stocks.

Days sales in inventory

Dell takes fewer days to convert its stock into sales in 2011 as compare to apple it shows that its management is more efficient in handling inventory.

Receivable turnover ratio

Apple has slightly better in receiving amount from its debtor as it has rate of 10.37 as compared to dell, which has rate of 1o.this shows that Apple management is slightly better in handling its debtors in 2011.

Average collection period

Apple provides more days to its debtors (85 days) as compare to dell, which provides 38 days to its debtors in 2011.

Debt to asset ratio

Dell has charge on its assets (0.83) as compared to apple, which has only 0.53 charges on its assets in 2011

Gross profit ratio

Dell makes less profit (17.50) as compares to apple, which makes profit at the rate of approximately of 44.6%. It shows that dell is more concerned in fulfilling its cost and charges fewer prices.

Profit margin

Dell after meeting its admin and selling expenses retains only 2.70% while apple makes 28.20% profit, which shows that apple charges high price.

Return on total assets

Dell makes less profit on assets, which may indicate two things. First is that management less efficient in handling its assets other is as their profit margin is less so that shows less intention of their in making profit. However, apple makes huge return on its assets that is around 30% in 2011 which may indicate that they are efficient in handling its assets in 2011.

Return on equity

Dell has return on equity 25.4%, which is, less than apple (46.83) it shows that investors will be more interested in apple as compared to dell in 2011

Assets turnover ratio

Dell has less efficient management as it has assets turnover ratio of 0-63 as compare to Apple, which has ratio of 1.15.it shows that dell makes less use of its assets in making sales as compare to apple in 2011.

FINANCIAL ANALYSIS OF PEPSI AND COCA COLA

Current assets ratio

Pepsi has a current asset ratio of 0.9 as compare to Coca Cola, which shows that coca cola is in better position to meet its short-term liabilities in 2011.

Inventory turnover ratio

Pepsi has less inventory turnover ratio (5.2) as compare to Coca Cola which has 5.8. It shows that coca cola is more efficient in turning its inventory into sales in 2011.

Day's sales in inventory

Pepsi takes 68 days to convert it stock into sales while coca cola takes 61 days to convert its stock into sales. It shows that coca cola management is more efficient.

Receivables turnover ratio.

Pepsi debtors pay its debt with slightly better rate that is 10.04 as compared to coca cola which has rate of 10.1.

Average collection period

Pepsi collects its debts within period of 37 days as compared to coca cola which collects its debts within period of 73 days. It shows Pepsi follows more strict policy of collecting its debts

Debt to asset ratio.

Pepsi has charge of 0.71 on its assets as compare to Coca Cola, which has charge of 0.604. So financial position of coca cola is better that Pepsi.

Interest earned ratio

Pepsi has interest coverage ratio of 11.3 as compare to coca cola which has interest coverage ratio of 26.3 which shows that coca cola has more profits available in 2011 to pays interest.