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Starbucks
The short-term liabilities of Starbucks are $2.075 billion. The long-term debt is $549.5 million. Total long-term liabilities -- not the same thing as long-term debt -- are $899.7 million.
The market value of equity of Starbucks (market cap) is $31.17 billion.
The debt ratio of Starbucks is as follows: 2975.5 / 7360.4 = .404
The debt to equity ratio of Starbucks is as follows: 2975.5 / 4384.9 = 0.678
The short-term debt to equity ratio is as follows: 2075.8 / 4384.9 = 0.473
The short-term debt ratio is as follows: 2075.8 / 7360.4 = 0.282
The long-term debt to equity ratio is as follows: 899.7 / 4384.9 = .205
The long-term debt ratios is as follows: 899.7 / 7360.4 = .112
I believe that this debt ratio is healthy. There are two reasons for this. The first is that Starbucks has a low degree of leverage with a debt ratio of this nature. The company is primarily financed through equity. Moreover, the level of long-term debt has remained unchanged for several years and this indicates that the company...
As capital structures go, an equity-oriented capital structure implies a company that sees itself as having a long-term growth trajectory. This is the case for Starbucks, so an equity-oriented structure is a good one for Starbucks.
3. The debt-to-equity ratio for Dunkin Brands is as follows: 2841.05 / 306.24 = 9.277
The debt-to-equity ratio for McDonalds is as follows: 17,341 / 14634.2 = 1.185
The highest D/E ratio of these three companies is at Dunkin Brands. This company is almost entirely financed by debt and has a very low equity level. The company's long-term debt situation is not worsening very quickly, but the company has struggled to build the book value of its equity in recent years. Dunkin has barely turned any profit lately ($26.86 million in FY2010 on $536 million in revenue). The fact that the company has just $536 million in revenue but has liabilities of $2.8 billion is alarming. Almost all of its asset base is in the form of "goodwill" and "intangibles." I would not want to invest in a company that will take decades…
Works Cited:
MSN Moneycentral: Dunkin Brands (2011). Retrieved November 28, 2011 from http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?lstStatement=Balance&stmtView=Ann&symbol=DNKN
MSN Moneycentral: McDonalds (2011). Retrieved November 28, 2011 from http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?lstStatement=Balance&stmtView=Ann&symbol=MCD
MSN Moneycentral: Starbucks (2011). Retrieved November 28, 2011 from http://moneycentral.msn.com/investor/invsub/results/statemnt.aspx?lstStatement=Balance&stmtView=Ann&symbol=SBUX
Starbucks Ratio Analysis The relevance of ratio analysis cannot be overstated in seeking to assess the financial viability of an enterprise. As Porter and Norton (2012) point out, ratio analysis is one of the most important “techniques used by investors, creditors, and analysts in making informed decisions” (p. 698). Starbucks Corporation remains one of America’s foremost coffee marketers and retailers. In addition to sourcing, roasting, as well as selling coffee, the
Starbucks Ratio Analysis Ratio analysis is a tool that is beneficial in undertaking quantitative analysis on figures found on financial statements. Ratios provide a common approach for comparing financial strength and performance of two or more companies. Imperatively, ratios can divulge a company’s financial strength or weakness in addition to divulge trends regarding business conditions and profitability (Noreen, Brewer, and Garrison, 2017). The main purpose of this assignment is to perform
However, the company has in general enjoyed success overseas and as a result international sales now account for 27% of operating income (2010 Starbucks Annual Report). The international division remains a key source for growth at Starbucks, in particular the Chinese market, where Starbucks has enjoyed considerable success and now sits at over 500 stores. The company struggled in the mid-2000s due to two main factors. The first was the
Starbucks and Peet's have similar gross margins. Dunkin' Brands has a much better gross margin at 78.9%, while McDonalds has a lower gross margin at 39.6%. Starbucks' gross margin might put it in the middle of the pack for quick service, but it is still a healthy margin. The company is profitable, something most of the firms in the industry are. Interesting, Dunkin is the least profitable of these
1. Introduction Firms may be successful by satisfying customer needs, but their ultimate accountability for financial performance is to the owners of the firm. Actions undertaken by quoted firm will usually have the direct, or indirect, aim of generating revenues and profits for the firm, and therefore the owners (Tarraf, 2012). When investors assess a potential investment they will look at the financial performance of a firm, assessing the past performance,
.....K, which is for the year ended October 2, 2016. This was used because many ratios are compared on an annual basis -- a quarterly report would yield different numbers. The first section is the liquidity ratios. These reveal the short-term health of Starbucks. The basic liquidity measure is the current ratio, which is the current assets over current liabilities. Starbucks, at 1.05, is at the industry average, and 1.05 is