CASE 1 SPECIALTY RETAILER 1. Abercrombie & Fitch Co. (52 week fiscal year ended January 29, 2011; 52 week fiscal year ended January 30, 2010) "Abercrombie & Fitch Co.....is a specialty retailer that operates stores and direct-to-consumer operations." 10-K 2. Limited Brands, Inc. (52 week fiscal year ended January 29, 2011; 52 week fiscal year ended January 30, 2010) "We operate in the highly competitive specialty retail business." 10-K 3. GAP, Inc. (52 week fiscal year ended January 29, 2011; 52 week fiscal year ended January 30, 2010) "We are a global specialty retailer offering apparel, accessories, and personal care products." 10-K Date reviewed Abercrombie & Fitch Limited Brands GAP 2010 2009 2010 2009 2010 2009 4.33 2.70 8.37 5.19 8.21 5.21 2.78 11.82 7.07 16.00 Net profit margin 7.76 Return on assets 14.17 Return on total equity 23.76 8.08 4.30 43.98 21.63 26.84 Required: a. b. Comment on the net profit margin for these companies. Consider absolute amounts and trend. Comment on the return on total equity or these companies. Consider absolute amounts and trend. Comment on the relative probability of these companies. c