CHAPTER 4 Financial Analysis 127 Balance Sheets, January 31,2009 Sears Holdings Target 5 864.000 9.446,000 6,705,000 $ 1,297,000 866,000 8,795,000 Cash and cash equivalents Accounts receivable Inventory Other current assets Total current assets Long-term investments Property. plant, and equipment Other assets $17.488,000 163,000 25,756,000 699,000 $44.106.000 $7,366.000 1.262.000 1.884,000 $10,512,00o 17,490,000 12,904,000 $40,906,000 13.712,000 $44,106,000 $11,416,000 5,835,000 25,342,000 $ 3,430,000 Total assets Accounts payable Short-term/current long-term debt Other curent liabilities 787,000 4.295.000 Total current liabilities Long-term debt Other long-term liabilities 2,132,000 13,830,000 $24,474,000 Total liabilities Total common stockholders' equity Total liabilities and stockholders' equity 9.380,000 Mini-Case Go to http://inance,yahoo.com/, and locate current financial in- b. What is each firm's current price-earnings ratio and market- (MCD), including each company's current financial statements r Starbucks Corp. (SBUX) and McDonald's Corp. to-book ratio? What do these ratios tell you about how in- vestors value these two firms' future prospects? and stock market prices. With this information: a. Compute the financial ratios for both firms for the most re- c. Based on your analysis, what is your personal assessment of the two firms' past performance? cent year, and evaluate the relative performance of the two firms in the following areas: Liquidity Asset management efficiency Financing practices (capital structure) . Profitability CHAPTER 4 Financial Analysis 127 Balance Sheets, January 31,2009 Sears Holdings Target 5 864.000 9.446,000 6,705,000 $ 1,297,000 866,000 8,795,000 Cash and cash equivalents Accounts receivable Inventory Other current assets Total current assets Long-term investments Property. plant, and equipment Other assets $17.488,000 163,000 25,756,000 699,000 $44.106.000 $7,366.000 1.262.000 1.884,000 $10,512,00o 17,490,000 12,904,000 $40,906,000 13.712,000 $44,106,000 $11,416,000 5,835,000 25,342,000 $ 3,430,000 Total assets Accounts payable Short-term/current long-term debt Other curent liabilities 787,000 4.295.000 Total current liabilities Long-term debt Other long-term liabilities 2,132,000 13,830,000 $24,474,000 Total liabilities Total common stockholders' equity Total liabilities and stockholders' equity 9.380,000 Mini-Case Go to http://inance,yahoo.com/, and locate current financial in- b. What is each firm's current price-earnings ratio and market- (MCD), including each company's current financial statements r Starbucks Corp. (SBUX) and McDonald's Corp. to-book ratio? What do these ratios tell you about how in- vestors value these two firms' future prospects? and stock market prices. With this information: a. Compute the financial ratios for both firms for the most re- c. Based on your analysis, what is your personal assessment of the two firms' past performance? cent year, and evaluate the relative performance of the two firms in the following areas: Liquidity Asset management efficiency Financing practices (capital structure) . Profitability
