Analysis of Campbell Soup Company
Below I have attached the data to analyze
CAMPBELL SOUP COMPANY Consolidated Balance Sheets (millions, except per share amounts) July 30, 2017 July 31, 2016 $ 296 626 940 46 1,908 319 605 902 - 74 1,900 2,454 2,115 1,118 139 7,726 2,407 2,263 1,152 107 7.837 $ $ $ Current assets Cash and cash equivalents Accounts receivable, net Inventories Other current assets Total current assets Plant assets, net of depreciation Goodwill Other intangible assets, net of amortization Other assets ($51 as of 2017 and $34 as of 2016 attributable to variable interest entity) Total assets Current liabilities Short-term borrowings Payable to suppliers and others Accrued liabilities Dividends payable Accrued income taxes Total current liabilities Long-term debt Deferred taxes Other liabilities Total liabilities Commitments and contingencies Campbell Soup Company shareholders' equity Preferred stock; authorized 40 shares; none issued Capital stock, $.0375 par value; authorized 560 shares; issued 323 shares Additional paid-in capital Eamings retained in the business 1,037 666 561 111 20 1,219 610 604 100 22 2,555 2,314 396 1,039 6,304 2,395 2,499 490 697 6,081 12 359 12 354 1.927 2,385 1,637 Total Campbell Soup Company shareholders' equity Noncontrolling interests Total equity Total liabilities and equity 1,525 8 1,533 7,837 1,645 7,726 $ $ See accompanying Notes to Consolidated Financial Statements. 2. Create Common Size: a. Income Statement (include this in your Income Statement worksheet) b. Balance Sheet (include this in your Balance Sheet worksheet) c. What three (3) observations can you make for each statement? i. Three (3) for balance sheet ii. Three (3) for income statement 3. Complete the ratio analysis a. How has the firm's liquidity changed from 2018 to 2019? i. Compute the current ratio, quick ratio, cash ratio and net working capital ratio ii. How does your firm compare to the industry? b. How has the firm's long-term solvency changed from 2018 to 2019? i. Compute the debt ratio, the debt-equity ratio, the equity multiplier and the long- term debt ratio ii. How does your firm compare to the industry? c. How has the firm's ability to meet interest payments changed from 2018 to 2019? i. Compute the times-interest earned & cash coverage ratio ii. How does your firm compare to the industry? d. How has the firm's asset management ratios changed from 2018 to 2019? i. Compute the inventory turnover & days sales in inventory? How would you interpret these ratios? ii. Compute the receivables turnover & days sales outstanding? How would you interpret these ratios? iii. What is the firm's total asset turnover and fixed asset turnover? Has the firm shown improvement in this area? iv. How does your firm compare to the industry? e. How has the firm's profitability changed from 2018 to 2019? i. Compute the profit margin, return on assets and return on equity ii. How does your firm compare to the industry? f. How has the firm's market value changed from 2018 to 2019? (You will need to find the stock price as of the end of the firm's fiscal year to compute these ratios) i. Compute the PE ratio, the market to book ratio and the EBITDA ratios ii. How does your firm compare to the industry? 4. Using Dupont analysis, show how the firm's ROE has changed from 2018 to 2019. What are the significant changes that most impacted the change in the firm's ROE? CAMPBELL SOUP COMPANY Consolidated Balance Sheets (millions, except per share amounts) July 30, 2017 July 31, 2016 $ 296 626 940 46 1,908 319 605 902 - 74 1,900 2,454 2,115 1,118 139 7,726 2,407 2,263 1,152 107 7.837 $ $ $ Current assets Cash and cash equivalents Accounts receivable, net Inventories Other current assets Total current assets Plant assets, net of depreciation Goodwill Other intangible assets, net of amortization Other assets ($51 as of 2017 and $34 as of 2016 attributable to variable interest entity) Total assets Current liabilities Short-term borrowings Payable to suppliers and others Accrued liabilities Dividends payable Accrued income taxes Total current liabilities Long-term debt Deferred taxes Other liabilities Total liabilities Commitments and contingencies Campbell Soup Company shareholders' equity Preferred stock; authorized 40 shares; none issued Capital stock, $.0375 par value; authorized 560 shares; issued 323 shares Additional paid-in capital Eamings retained in the business 1,037 666 561 111 20 1,219 610 604 100 22 2,555 2,314 396 1,039 6,304 2,395 2,499 490 697 6,081 12 359 12 354 1.927 2,385 1,637 Total Campbell Soup Company shareholders' equity Noncontrolling interests Total equity Total liabilities and equity 1,525 8 1,533 7,837 1,645 7,726 $ $ See accompanying Notes to Consolidated Financial Statements. 2. Create Common Size: a. Income Statement (include this in your Income Statement worksheet) b. Balance Sheet (include this in your Balance Sheet worksheet) c. What three (3) observations can you make for each statement? i. Three (3) for balance sheet ii. Three (3) for income statement 3. Complete the ratio analysis a. How has the firm's liquidity changed from 2018 to 2019? i. Compute the current ratio, quick ratio, cash ratio and net working capital ratio ii. How does your firm compare to the industry? b. How has the firm's long-term solvency changed from 2018 to 2019? i. Compute the debt ratio, the debt-equity ratio, the equity multiplier and the long- term debt ratio ii. How does your firm compare to the industry? c. How has the firm's ability to meet interest payments changed from 2018 to 2019? i. Compute the times-interest earned & cash coverage ratio ii. How does your firm compare to the industry? d. How has the firm's asset management ratios changed from 2018 to 2019? i. Compute the inventory turnover & days sales in inventory? How would you interpret these ratios? ii. Compute the receivables turnover & days sales outstanding? How would you interpret these ratios? iii. What is the firm's total asset turnover and fixed asset turnover? Has the firm shown improvement in this area? iv. How does your firm compare to the industry? e. How has the firm's profitability changed from 2018 to 2019? i. Compute the profit margin, return on assets and return on equity ii. How does your firm compare to the industry? f. How has the firm's market value changed from 2018 to 2019? (You will need to find the stock price as of the end of the firm's fiscal year to compute these ratios) i. Compute the PE ratio, the market to book ratio and the EBITDA ratios ii. How does your firm compare to the industry? 4. Using Dupont analysis, show how the firm's ROE has changed from 2018 to 2019. What are the significant changes that most impacted the change in the firm's ROE
