Question
analyze IBMs financial information to answer the following question: What is your assessment of IBMs financial performance the past three years (2012-2014)? The raw data
analyze IBMs financial information to answer the following question: What is your assessment of IBMs financial performance the past three years (2012-2014)? The raw data from these tables (e.g., sales and expense figures), especially when compared to previous times or to data from the competition gives us some information. In addition, the ratios for profitability, activity and leverage will also give you an indication of how well the firm is performing. Chapter 5 and the last page of the printed text gives you information and meaning of the ratios to assist your analysis.
ASSIGNMENT: Analyze the raw data in the table and calculate the following ratios (show the calculations) for the past three years: Gross Margin, Return on Assets, Return on Equity, Return on Revenue, Total Asset Turnover, Debt to Equity, Long Term Debt to Equity, and any other ratios you believe are important.
You should not only calculate the ratios but you should also look at them and tell me what the financial and operational health of IBM is at the time of the case. Are there concerns with any of their ratios? What ratios seem particularly strong or weak?
SWOT: Based on your analysis above, indicate which you would include in a SWOT analysis for IBM (one column for Strengths and one column for Weaknesses). An Important Note: 1. Do not perform a complete SWOT analysis on IBM, but rather just look at the financial strengths and weaknesses of IBM; and 2. not every ratio or conclusion you derived from you financial analysis will necessarily appear in the SWOT analysis, rather select the ones you believe are of critical importance.
| Fiscal Year | 2012 | 2013 | 2014 |
| Cash and short term investments | 11129 | 11066 | 8476 |
| Receivables(total) | 30578 | 31836 | 31832 |
| Inventories(total) | 2287 | 2310 | 2103 |
| Property, plant, and equipment (net total) | 13996 | 13821 | 10771 |
| Depriciation, and amortzation (accumulated) | 26506 | 26654 | 28263 |
| Assets (total) | 119213 | 126223 | 117532 |
| Accounts Payable (trade) | 7952 | 7461 | 6864 |
| Long Term debt | 24088 | 32856 | 35074 |
| Liabiliies total | 100229 | 103294 | 105518 |
| stockholders equity | 18860 | 22792 | 11868 |
| Sales (net) | 104507 | 99751 | 92793 |
| costs of goods sold | 48987 | 45981 | 41353 |
| selling general and admin expenses | 29671 | 29703 | 28607 |
| income taxes | 5298 | 3041 | 4234 |
| income before extraordinary items | 16604 | 16483 | 15751 |
| net income (loss) | 16604 | 16483 | 12022 |
| earnings per share (basic) | 14.53 | 15.06 | 15.68 |
| earnings per share (diluted) | 14.37 | 14.94 | 15.59 |
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