COMPARATIVE ANALYSIS: ABERCROMBIE & FITCH vs.

AEROPOSTALE Refer to the financial statements of Abercrombie & Fitch and Aeropostale that are supplied with this text.

Required:

Answer the following questions:

What is the fiscal year-end of Abercrombie & Fitch? Of Aeropostale? Why would you expect these to be the same?

With regard to the balance sheet:

a. What amounts did each company report for assets, liabilities, and stockholders’

equity for the year ended February 3, 2007?

b. What amounts were reported as current assets and current liabilities for the year ended February 3, 2007?

c. Assess the liquidity of each company.

d. Describe any other similarities and differences that you noticed between the two companies.

With regard to the income statement:

a. What amounts did Abercrombie & Fitch report as revenues, expenses, and net income for the year ended February 3, 2007 (fiscal 2006)? What amounts did Aeropostale report as revenues, expenses, and net income for the fiscal year ended February 3, 2007?

b. Compare any trends that you detect with regard to revenues, expenses, and net income?

c. What are the earnings per share of each company? What insights does this give you with regard to future profitability and growth?

What were the major sources and uses of cash for each company?

What is management’s assessment of each company’s past performance and future prospects? Where did you find this information?

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