Question
Clearly calculate the DuPont Identity and provide analysis and takeaways you can make regarding operating efficiency, asset use efficiency, and financial leverage. Then, given the
Clearly calculate the DuPont Identity and provide analysis and takeaways you can make regarding operating efficiency, asset use efficiency, and financial leverage. Then, given the performance of the stock in the periods presented (5 years) on the companys financial statements, discuss how the stock is likely to perform in the future, what type of investor would be drawn to this stock, and make a recommendation to management to improve stock performance using what you discovered with the DuPont Identity. Display a line graph to see trends
DuPont Analysis=Net Profit MarginATEM
where: Net Profit Margin=Net Income/Revenue
AT=Asset turnover
Asset Turnover= Sales/ Average Total Assets
EM=Equity multiplier
Equity Multiplier= Average Total Assets//Average Shareholders Equity
Revenue:
| ITEM | 2017 | 2018 | 2019 | 2020 | 2021 |
|
| Sales/Revenue | 445.3M | 593.75M | 769.43M | 840.88M | 847.52M |
Net Income:
2017- 225,525,000
2018- 203,009,000
2019- 259,016,000
2020- 112,170,000
2021- 52,116,000
Sales
2017- 847,522,000
2018- 840,833,000
2019- 769,432,000
2020- 593,749,000
2021- 445,304,000
Total Assets: Average Total Assets: 1,014,000,000
2017- 1,494,000,000
2018- 1,216,000,000
2019- 1,054,000,000
2020- 756,000,000
2021- 550,000,000
Shareholders Equity: Average Shareholders Equity: 894.8
2017- 1330
2018- 1065
2019- 937
2020- 690
2021- 452
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Financial Risk Manager Handbook
Authors: Philippe Jorion, Global Association Of Risk Professionals
5th Edition
0470479612, 978-0470479612
