1000+ documents containing “financial statement analysis”.
Financial statement analysis is a tool by which one can examine the publicly-available financial statements to determine the financial condition of a company. The role of the financial statements is to provide information for both internal and external stakeholders, including shareholders and regulators, about a company's finances. Thus, the SEC demands that financial statements are produced in a specific format so that there is easy comparison between companies and across industries (SEC.gov, 2014). One of the most common means of analyzing statements is to examine the trends in the statements, and to conduct analysis by a set of ratios that will explain about the liquidity, solvency, efficiency and returns for the company (Investopedia, 2014). This report will contain a financial statement analysis of Starbucks.
Starbucks has demonstrated progressive revenue growth. evenue in FY 2014 was $16.4 billion, compared with $14.8 billion in 2013, an increase of 10.8%, and the prior years….
Burritt, C. (2013). Starbucks to pay $2.9 billion to settle coffee dispute. Bloomberg. Retrieved December 6, 2014 from http://www.bloomberg.com/news/2013-11-12/starbucks-to-pay-2-76-billion-to-settle-grocery-dispute.html
Investopedia. (2014). CFA level 1: Financial statement analysis. Investopedia. Retrieved December 6, 2014 from http://www.investopedia.com/exam-guide/cfa-level-1/financial-statements/financial-statement-analysis.asp
MSN Moneycentral: Starbucks (2014). Retrieved December 6, 2014 from http://www.msn.com/en-us/money/stockdetails?symbol=SBUX&ocid=qbeb
Sayre, K. (2014). Starbucks CEO says drink prices won't go up despite spike in coffee bean costs. New Orleans Times-Picayune Retrieved December 6, 2014 from http://www.nola.com/business/index.ssf/2014/03/starbucks_ceo_warns_rising_cof.html
Financial Statement Analysis
The following is an equity research report on Starbucks. The company competes primarily in the quick service food industry, where it holds the #5 market share in the United States, and #1 in its segment of coffee (QSR Magazine, 2011). The company had revenues last fiscal year (ended 10/2/11) of $11.7 billion and net income of $1.245 billion. The current stock price is $43.91, which gives the company a market capitalization of $32.73 billion and a price/earnings ratio of 27.10.
This report will begin with a qualitative analysis of the firm, its industry and its markets. The next step will be an analysis of its financial statements, followed by an analysis of the stock price. A determination will be made as to whether the stock should be rated a "buy," "hold," or "sell."
The evaluation will be based on careful consideration of the company's recent financial performance and its current….
2010 Starbucks Annual Report. In possession of the author.
Adamy, J. & Wingfield, N. (2009). Starbucks to present recession strategy. Wall Street Journal. Retrieved December 4, 2011 from http://online.wsj.com/article/SB123723335325646025.html
Cannold, J. (2011). Starbucks buys juice maker Evolution Fresh. CNN. Retrieved December 4, 2011 from http://money.cnn.com/2011/11/10/news/companies/starbucks_juice_evolution_fresh/index.htm
Liu, L. (2009). McDonalds' McCafe takes aim at Starbucks in Europe. Business Week. Retrieved December 4, 2011 from http://www.businessweek.com/magazine/content/09_40/b4149070703260.htm
Financial Statement Analysis
Westpac banking corporation is one of the largest banking organizations in Australia, and the largest bank in New Zealand. Westpac provides arrays of banking and financial services in Austria, which include institutional banking, retail banking, and wealth management services. Established in 1817, Westpac is the first bank established in Australia. Since its formation, Westpac has increased in its strength, and at present Westpac has the market capitalisations that reach $69.5 billions and total assets worth 618.3 billions. (Westpac Annual eport, 2010).
The objective of this paper is to analyze whether Westpac could be a potential company to invest my $50,000.
With the present economic crisis where many companies have suffered financial losses, it is critical to subject a company to financial analysis since I have decided to invest my $50,000 on the medium-term investment; there is a need to make thorough analysis on the company before making an investment….
This has been especially true in China and other Asian countries during the past several decades of economic expansion in that region of the world (Bai et al. 2008). Government stakeholders in many of these countries have benefited along with corporations in obscure and outright false financial statements and analyses as they have attracted money form foreign as well as domestic investors an enabled national growth for many Asian nations (Bai et al. 2008). These investors, on the other hand, as well as many private citizens in these countries, have suffered avoidable losses and unnecessary economic disruptions when the misleading reporting and analysis practices are brought to light and the truth is revealed (Bai et al. 2008).
In the United States, the problem is possibly even more complex. More stringent government oversight supposedly limits issues of outright deception, but questionable and obfuscating techniques are still rampant in financial analysis in….
Bai, B.; Yen, J, & Yang, X. (2008). "False financial statements: Characteristics of China's listed companies and cart detecting approach." International journal of information technology and decision making 7(2), pp. 339-59.
Gauthier, S. (2004). "Presenting information in financial reports." Government finance review. Accessed online 18 September 2009. http://www.allbusiness.com/finance/3584383-1.html
This means that Ferrellgas is in risk of default. The company paid more in dividends last year than it earned in cash from operations. In short, Ferrellgas has an unsustainable burn rate. While Inergy had a poor financial position, it was able to tap into capital markets to alleviate any cash crunch -- Ferrellgas has yet to do this and of all these firms is the closest to default.
Amerigas is a mediocre performer among this group. While the company has very little cash and a low current ratio, it is earning enough to cover its interest. It is also paying less in dividends than its cash flow from operations, although it is probably paying too much given its earnings level and apparent need for capital expenditures. However, there are red flags with this company as well. For example, given its current cash situation, one would want to see an….
Managing its fleet. This pertains to the optimization of an Airline's major assets, which is its airplanes, which is measure by its load factor, which is that percentage of an airplane's sets that are sold and actually filled at departure. The Company's load factor continues to increase from 69.5% in 2004, to 70.7% in 2005 to 73.1% in 2006. The Company is able to maximize its fleet by reducing its ground time (the amount of time planes spend on the ground at airports). Most airlines have an hour ground time compared to the Company's 15-20 minute ground time.
Managing People. Fortune magazine ranks the Company as one of the top 100 best companies to work for. The Company boasts of treating their employees like their customers, this has given the Company with the image and reputation of giving its customers the great value with their money. The dedication of its employees….
HP: Financial Statement Analysis
There are many approaches one could use to analyze the health, stability as well as financial performance of a business entity. One such approach involves a thorough review of the financial statements of the concerned entity. egarded the leading personal computers manufacturer in the world, Hewlett-Packard - HP amongst other things concerns itself with the manufacture as well as development of both computer hardware and software. In this text, a thorough financial review of HP will be conducted in an attempt to determine the viability of the company's stock as an investment option.
Hewlett-Packard: Background Information
As I have already pointed out in the introductory section, HP is regarded one of the world's largest manufacturers of personal computers. Together with its subsidiaries, HP provides "products, technologies, software, applications and services to individual customers, businesses enterprises, including customers in the government, health, and education sectors" (Mergent Online, 2013). To serve….
Arora, M.N. (2009). Management Accounting: Theory, Problems and Solutions. Mumbai: Global Media.
Mergent Online. (2013). Hewlett-Packard Co (NYS: HPQ). Retrieved July 14, 2013, from Ashford University, Clinton, IA, University Library Website: http://www.mergentonline.com
Ramagopal, C. (2008). Financial Management. Daryaganj, Delhi: New Age International.
Smith, B. (2010). Introductory Financial Accounting. Berkshire, GBR: McGraw-Hill Professional Publishing.
The data must be absolutely correct.
3. Effects of Price Level Changes: Price levels changes often make the comparison of figures difficult over a period of time. Changes in price affect the cost of production, sales and also the value of the assets. Therefore, it is necessary to make proper adjustment for price-level changes before any comparison.
4. Quality factors are ignored: atio analysis is a technique of quantitative analysis and thus, ignores qualitative factors, which may be important in decision-making. For example, an average collection period may be equal to standard credit period, but some debtors may be in the list of doubtful debts, which is not disclosed by ratio analysis.
5. Effect of window dressing: In order to cover up their bad financial position some companies resort to window dressing. They may record the accounting data according to the convenience to show the financial position of the company in a….
De Mello-e-Souza, C.A. & Awasthi, V.N. (2009).Probing Financial Statements in PostSarbanes-Oxley world. Strategic Finance. Retrieved on 3rd April, 2010 from http://findarticles.com/p/articles/mi_hb6421/is_10_90/ai_n31947078/
Credit and Finance Risk Analysis (2010). Bank Financial Statement Analysis & Ratio Analysis. Retrieved on 3rd April, 2010 from http://www.credfinrisk.com/bank.html
Sooper Tutorials. (2009). Financial Ratio Analysis and Formulas. Retrieved on 3rd
April from http://www.soopertutorials.com/business/finance/1992-financial-ratio-analysis-formulas.html
Consolidation of Financial Statement Analysis
In the wake of the Enron collapse, the chairman of the Securities Exchange Commission (SEC) repeated his calls for the nation's securities laws to be updated in an effort to avoid another such case. In an article in December 11, 2001's Wall Street Journal, Harvey Pitt wrote that the Enron collapse underscores the need to update and improve the nation's financial reporting and disclosure laws that were first developed in the 1930s. Pitt emphasized that investors needed current, not quarterly or annual, corporate information. The current approach to remedying a clearly broken system have been too little, too late according to some observers. Clarke and Oliver, for instance, point out that, "Paradoxically, one of accounting's grandest inventions to achieve financial clarification is its most virile medium for deception. From its introduction, giving special status to a group of related companies and the methods of consolidating its….
Blacconiere, Walter G. And Patrick E. Hopkins. 2002. General Electric: Investment Accounting and Consolidations. Issues in Accounting Education, Volume 17, Issue 3, p. 315.
Clarke, Dean and Oliver. 2003. Corporate Collapse. Cambridge University Press.
FASB Issues Exposure Draft on Accounting for Stock Options, Amends Transition and Disclosure Provisions, 2002, 1-3. October 4, 2002. FASB. Available: http://www.fasb.org/news/nr100402.shtml .
FASB Presents Views on Consolidated Statements. 1994. Journal of Accountancy, Volume 178, Issue 5, p. 22-5.
Financial Statement AnalysisFinancial statement analysis refers to developing and analyzing a particular companys financial statements to help with the decision-making processes. It is also essential since it helps external stakeholders such as investors understand its overall condition and evaluate the business value and financial performance. Internally, it is used as a tool to monitor and manage the organizations finances. A companys financial statements record essential financial data on all organizations activities (Kunnathur, 2017). They can be evaluated based on past, present, or future performance. They are generally centered on the generally accepted accounting principles.Apple Inc. Financial AnalysisCompany BackgroundThis is a multinational technology company with its headquarters in Cupertino, California. It is an American company established in 1977 by Wozniak and Steve Jobs, a great American visionary who aimed to change the world and use technology. His vision of entrepreneurship led to the creation of the essential technological advancement on earth.….
Bing, L., Chan, K. C., & Ou, C. (2014, November). Public sentiment analysis in Twitter data for prediction of a company’s stock price movements. In 2014 IEEE 11th International Conference on e-Business Engineering (pp. 232-239). IEEE.
Fama, E. F. (1990). Term-structure forecasts of interest rates, inflation, and real returns. Journal of Monetary Economics, 25(1), 59-76.
Hernández-Álvarez, M., Hernández, E. A. T., & Yoo, S. G. (2019, February). Stock Market Data Prediction Using Machine Learning Techniques. In International Conference on Information Technology & Systems (pp. 539-547). Springer, Cham.
Khan, U. A., Alam, M. N., & Alam, S. (2015). A critical analysis of internal and external environment of Apple Inc. International Journal of Economics, Commerce and Management, 3(6), 955-961.
Ben and Jerry's Financial Statement Analysis
Through a ratio analysis of Ben and Jerry's comparative balance sheet and comparative income statement for 2004 and 2005 it was determined that Ben and Jerry's appears to be financially stable. Three different types of ratios were used to assess the company's health including liquid rations, profitability ratios, and solvency ratios.
Liquid ratios that were analyzed included working capital, current ratio, and acid test ratio. "Liquidity ratios measure a firm's ability to meet its current obligations" (Credit esearch Foundation, 1999). Based upon the working capital, it was determined that in 2004, Ben and Jerry's had $8,200 on hand to satisfy contingencies and the number rose to $11,100 in 2005, which appears to indicate that Ben and Jerry's was more financially prepared the following year. Furthermore, an analysis of the current ratio, which measures Ben and Jerry's ability to pay off their debts determined that Ben and….
Overview of Financial Statementsa. The DuPont Analysis on EdlerCare is as follows:a. DuPont AnalysisElderCareIndustry AvgTotal Margin1.8%3.5%Total Asset Turnover0.81.5Equity Multiplier7.02.5ROE16.2%13.1%ElderCare's return on equity is higher than that of the industry average. What the DuPont analysis does is it reveals the sources of that return on equity. In the case of ElderCare, having a higher than average ROE is not necessarily good. The reason is that the single biggest contributor to the ROE for ElderCare is that it is highly-leveraged. It has a much higher equity multiplier than the industry average. It's other metrics are worse. It has a lower margin and a lower asset turnover than the industry average. For a company that is performing well, it would be better to see the asset turnover and the margin higher than the industry average. So for ElderCare the ROE is a bit of a deceptive figure because the company has a lot….
Financial HealthCompany OverviewAmazon is the worlds leading online retailer. The Seattle-based company started in 1994, selling mainly things like books and music, but it has expanded its products steadily since then. Today, Amazon is not only a retailer but also a media company, as they produce and market streaming content. They have long been an innovator in digital merchandising, and their techniques are widely-copied by competitors today. Amazon today is one of the worlds largest companies, with a vat product line. They compete against all other retailers a consumer is often faced with a decision to go to a store to buy something, or buy it from Amazon, and this owes to their position as the default online retailer.The following is a review of the past three years of Amazons financial statements. During this period, the company has extended its lead as the number one online retailer (BI Intelligence,….
Amazon 2014 Annual Report. In possession of the author.
Amazon 2016 Annual Report. In possession of the author
BI Intelligence. (2017) Amazon accounts for 43% of US online retail sales. Business Insider. Retrieved April 15, 2018 from http://www.businessinsider.com/amazon-accounts-for-43-of-us-online-retail-sales-2017-2
AT&T and Verizon
Both AT&T and Verizon have their roots as Baby Bells, large telecom companies that arose after the breakup of Bell. These are two of the largest telecom companies in the United States. At the time of the breakup, telecom was a highly stable business based on landline telecommunications, but the industry has transformed and is now strongly driven by wireless. As wireless technology continues to improve, being a player in wireless means having a high level of investment in fixed infrastructure assets, something that is evident on the balance sheets of both of these companies.
However, these companies differ significantly on how they are structured. Their businesses are very similar, but AT&T has kept a relatively low debt level, and sought growth through expansion. The massive amount of goodwill on its balance sheet and relatively small amount of long-term debt indicate this. Verizon, by contrast, has not been a….
Overview of Current Situation'
ABC is generally in good health. he income statement shows that the company saw an increase in revenue for 2009, and this translated to an increase in net income. he company's expenses as a percentage of revenue were 13.6%, down from 15.1% the year before. COGS was 69.6% of revenue, versus 78.2% the year before. he company maintained a similar level of works-in-progress inventory over the course of the year, such that the improved operating performance did not derive from a decrease in inventory. Manufacturing overhead as a percentage of sales also declined. In essence, the improved profit performance comes from incremental improvements in cost control that had the cumulative effect of reducing the overall expenses as a percentage of revenue.
he balance sheet shows that the company's overall value has increased. he key increase here is an investment in new equipment. he value of factory equipment….
There is evidence of continual improvement at ABC. First, there is the fact that the company grew its revenues without a corresponding growth in the expenses. This occurred on multiple fronts. ABC increased its gross margin, which seems to indicate improved manufacturing efficiency. The fact that the company was able to increase its sales, lower its COGS, and only experience a modest increase in its work-in-progress inventories indicates that it has become a more efficient manufacturer. It is difficult to extrapolate continual improvement from a one-year time sample, but the evidence shows that the company was more efficient in 2009, and that is cause for optimism that it will continue to improve going forward, especially given new investments.
The new investments in manufacturing equipment is another good sign. The company can point to this investment in new automated manufacturing equipment as an astute investment with a small amount of debt and a some equity as an investment in future production and revenue growth. This is evidence that the company is not resting on its laurels, but investing some of its success today in building future success in the future.
Furthermore, the company was able to control the growth of its non-manufacturing expenses. Even sales expenses as a percentage of revenue fell, from 7.0% to 6.8%. Other administrative expense categories fell even further as a percentage of sales. These figures indicate that the company has improved its administrative productivity -- it is getting more sales from roughly the same administrative expense. Sales expense increased but at a lower rate that the increase in revenues. Both of these figures also point to a company that has focused not just on selling more, but on improving its efficiency across all expense categories. Often, a company can improve in one or two areas with some focus, but to improve in all areas across the board, while growing, is a sign of mature management that is running a sustainable business. There is good cause for optimism regarding the future of ABC based on its 2008 and 2009 financial statements.
Financial statement analysis is a tool by which one can examine the publicly-available financial statements to determine the financial condition of a company. The role of the financial statements…Read Full Paper ❯
Financial Statement Analysis The following is an equity research report on Starbucks. The company competes primarily in the quick service food industry, where it holds the #5 market share in…Read Full Paper ❯
Financial Statement Analysis Westpac (WBC) Westpac banking corporation is one of the largest banking organizations in Australia, and the largest bank in New Zealand. Westpac provides arrays of banking and financial…Read Full Paper ❯
This has been especially true in China and other Asian countries during the past several decades of economic expansion in that region of the world (Bai et al.…Read Full Paper ❯
This means that Ferrellgas is in risk of default. The company paid more in dividends last year than it earned in cash from operations. In short, Ferrellgas has…Read Full Paper ❯
Managing its fleet. This pertains to the optimization of an Airline's major assets, which is its airplanes, which is measure by its load factor, which is that percentage of…Read Full Paper ❯
HP: Financial Statement Analysis There are many approaches one could use to analyze the health, stability as well as financial performance of a business entity. One such approach involves a…Read Full Paper ❯
The data must be absolutely correct. 3. Effects of Price Level Changes: Price levels changes often make the comparison of figures difficult over a period of time. Changes in…Read Full Paper ❯
Consolidation of Financial Statement Analysis In the wake of the Enron collapse, the chairman of the Securities Exchange Commission (SEC) repeated his calls for the nation's securities laws to be…Read Full Paper ❯
Financial Statement AnalysisFinancial statement analysis refers to developing and analyzing a particular companys financial statements to help with the decision-making processes. It is also essential since it helps external…Read Full Paper ❯
Ben and Jerry's Financial Statement Analysis Through a ratio analysis of Ben and Jerry's comparative balance sheet and comparative income statement for 2004 and 2005 it was determined that Ben…Read Full Paper ❯
Overview of Financial Statementsa. The DuPont Analysis on EdlerCare is as follows:a. DuPont AnalysisElderCareIndustry AvgTotal Margin1.8%3.5%Total Asset Turnover0.81.5Equity Multiplier7.02.5ROE16.2%13.1%ElderCare's return on equity is higher than that of the industry…Read Full Paper ❯
Financial HealthCompany OverviewAmazon is the worlds leading online retailer. The Seattle-based company started in 1994, selling mainly things like books and music, but it has expanded its products steadily…Read Full Paper ❯
AT&T and Verizon Background Both AT&T and Verizon have their roots as Baby Bells, large telecom companies that arose after the breakup of Bell. These are two of the largest telecom…Read Full Paper ❯
Audit Case Overview of Current Situation' ABC is generally in good health. he income statement shows that the company saw an increase in revenue for 2009, and this translated to an…Read Full Paper ❯