HP Ratios In The Past Essay

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The return to form mirrored somewhat the bounceback in the current ratio last year. However, it is worth considering that the return on equity increased only because earnings did -- equity did not increase as it should have. Had the increase in profits been financed in part by debt rather than entirely by debt, the ROE would not have rebounded as it did last year. Days receivable is an indicator that highlights the ability of the firm to collect on the debts owed to it by the customers. For HP, the days receivable for last year was 62; for the year previous it was 61 and for the year before that it was 90.5. What this indicates is that for the past two years, HP has improved its days receivable considerably. Two years ago, it had a very high level of accounts receivable and over the course of the past two years...

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This has helped the company's bottom line last year. While the new figure is much better than the one from two years ago, it remains relatively high and provides HP with an area in which it can improve its financial performance going forward.
Overall, Hewlett Packard's financial performance is moderately positive for the past three years. There has been some fluctuation in the figures, so there is no clear trend. Some of the figures improved last year, while others worsened. Overall, this makes it difficult to determine the future of HP's finances. At present, the ratios are generally good but unexceptional, but at the same time there is little cause for concern either. HP simply has middle of the road numbers so with no particular trend there is no emphatic judgment…

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Return on equity was 21.64% last year. It was 18.9% in 2009 and in 2008 it was 21.3%. These figures indicate that the company has actually rebounded financially in the past year. A profit was made, and it was better in terms of its return on equity than the previous year. The return to form mirrored somewhat the bounceback in the current ratio last year. However, it is worth considering that the return on equity increased only because earnings did -- equity did not increase as it should have. Had the increase in profits been financed in part by debt rather than entirely by debt, the ROE would not have rebounded as it did last year.

Days receivable is an indicator that highlights the ability of the firm to collect on the debts owed to it by the customers. For HP, the days receivable for last year was 62; for the year previous it was 61 and for the year before that it was 90.5. What this indicates is that for the past two years, HP has improved its days receivable considerably. Two years ago, it had a very high level of accounts receivable and over the course of the past two years has taken steps to rein that in. This has helped the company's bottom line last year. While the new figure is much better than the one from two years ago, it remains relatively high and provides HP with an area in which it can improve its financial performance going forward.

Overall, Hewlett Packard's financial performance is moderately positive for the past three years. There has been some fluctuation in the figures, so there is no clear trend. Some of the figures improved last year, while others worsened. Overall, this makes it difficult to determine the future of HP's finances. At present, the ratios are generally good but unexceptional, but at the same time there is little cause for concern either. HP simply has middle of the road numbers so with no particular trend there is no emphatic judgment that can be made with respect to its financial ratios.


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