Question
At a minimum your analysis should include ROE, ROA and the componenents for DuPont analysis (profit margin, total asset turnover and equity mulipler or D/E
At a minimum your analysis should include ROE, ROA and the componenents for DuPont analysis (profit margin, total asset turnover and equity mulipler or D/E ratio).Since ratios are not particuarly useful in isolation, you'll need some comparisons.You should calculate the ratios for your firms for at least two years and note how the ratio changed.Additionally, you should compare your firm to the same ratios as other firms in their industry - either choose 2 competitor firms or use industry averages (these are both available on Bloomberg and industry averages are available on some financial websites).
This need not be long, but should probably include approximately 8-10 different ratios.You should also include a brief explanation of what the ratio means or is telling you about the firm's health.
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