Compare the performance of the two companies mentioned and analyze which company is in better financial standing in terms of Profitability, Liquidity, Efficiency, and leverage and provide your recommendations on what can they improve on to have a better financial standing.

The question is related to financial management

Here is the required Data

Walmart

The market Capitalization was 337.17 Billion at the end of 2019

Microsoft

Market capitalization was 1.2 Trillion at the end of 2019

DowDupont

The market capitalization was 151.1 billion at the end of 2018

Formula 2019 2018 2017 0.86 Liquidity Ratios Current ratio Quick ratio Cash ratio Current assets / Current liability (Current assets - inventory) / Current liability Cash & equivalent / Current liability 0.8 0.23 0.1 0.76 0.2 0.09 0.22 0.1 11.27 Efficiency ratios Inventory turnover Receivable turnover Payable turnover Total asset turnover 83.14 Sales / inventory Sales / receivable COGS / payables Sales / total assets 11.62 81.87 8.19 2.35 11.42 89.05 8.1 2.44 8.72 2.44 - Leverage ratio Debt ratio Total liabilities/Total assets Equity multiplier ratio Total assets / Common equity Times interest earned EBIT/ Interest 0.64 3.02 9.67 0.6 2.63 9.1 0.59 2.56 9.14 Profitability ratios Profit margin ROA ROE Net income / Sales Net income / Total assets Net income / Common equity 1.30% 3.04% 9.20% 1.97% 4.82% 12.66% 2.81% 6.86% 17.54% 2019 9.23% 2018 12.64% 2017 17.55% DuPont Equation ROE = Net Margin x Asset turnover ratio x Equity multiplier Working Formula 2019 2018 2017 Liquidity Ratios Current ratio Quick ratio Cash ratio Current assets / Current liability (Current assets - inventory) / Current liability Cash & equivalent / Current liability 0.799 0.228 0.100 0.760 0.202 0.086 0.862 0.219 0.103 Efficiency ratios Inventory turnover Receivable turnover Payable turnover Total asset turnover Sales / inventory Sales / receivable COGS/ payables Sales / total assets 11.620 81.873 8.187 2.346 11.418 89.047 8.101 2.444 11.270 83.144 8.719 2.440 0.595 Leverage ratio Debt ratio Equity multiplier ratio Times interest earned Total liabilities/ Total assets Total assets / Common equity EBIT / Interest 0.637 3.025 9.669 0.605 2.626 9.096 2.556 9.143 2019 2018 2017 0.013 Profit margin ROA ROE Profitability ratios Net income / Sales Net income / Total assets Net income / Common equity 0.030 0.092 0.020 0.048 0.127 0.028 0.069 0.175 DuPont Equation ROE = Net Margin x Asset turnover ratio x Equity multiplier 0.092 0.126 0.176 Microsoft Liquidity Year Current Ratio 2019 2.53 2018 2.9 2017 292 Year Quick Ratio 2019 2.35 2018 2.74 2017 2.37 Year Cash Ratio 2019 1.93 2018 2.29 2017 2.06 Dupont Analysis 2019 ROE 0.383 Profitable 2.154 Efficiency 0.063 Leverage 2.8 2018 ROE 0.2 Profitability 0.94 Efficiency 0.057 Leverage 3.129 2017 ROE 0.29 Profitable 1.648 Efficiency 0.061 leverage 2.85 Liquidity Year 2019 Current Ratlo 23 201 191 2018 2017 Year Quick ratlo 2019 221 1.94 1.86 2018 2017 Dupont analysis 2019 (-) 0.030 0.13% ROE Profitability Efficiency Leverage 2018 0.36 0.38 ROE Profitability 0.041 0.12% 0.26 Efficiency Leverage 0.23 2017 ROE Profitability 0.016 0.16% 0.33 Efficiency Leverage 0.13 Formula 2019 2018 2017 0.86 Liquidity Ratios Current ratio Quick ratio Cash ratio Current assets / Current liability (Current assets - inventory) / Current liability Cash & equivalent / Current liability 0.8 0.23 0.1 0.76 0.2 0.09 0.22 0.1 11.27 Efficiency ratios Inventory turnover Receivable turnover Payable turnover Total asset turnover 83.14 Sales / inventory Sales / receivable COGS / payables Sales / total assets 11.62 81.87 8.19 2.35 11.42 89.05 8.1 2.44 8.72 2.44 - Leverage ratio Debt ratio Total liabilities/Total assets Equity multiplier ratio Total assets / Common equity Times interest earned EBIT/ Interest 0.64 3.02 9.67 0.6 2.63 9.1 0.59 2.56 9.14 Profitability ratios Profit margin ROA ROE Net income / Sales Net income / Total assets Net income / Common equity 1.30% 3.04% 9.20% 1.97% 4.82% 12.66% 2.81% 6.86% 17.54% 2019 9.23% 2018 12.64% 2017 17.55% DuPont Equation ROE = Net Margin x Asset turnover ratio x Equity multiplier Working Formula 2019 2018 2017 Liquidity Ratios Current ratio Quick ratio Cash ratio Current assets / Current liability (Current assets - inventory) / Current liability Cash & equivalent / Current liability 0.799 0.228 0.100 0.760 0.202 0.086 0.862 0.219 0.103 Efficiency ratios Inventory turnover Receivable turnover Payable turnover Total asset turnover Sales / inventory Sales / receivable COGS/ payables Sales / total assets 11.620 81.873 8.187 2.346 11.418 89.047 8.101 2.444 11.270 83.144 8.719 2.440 0.595 Leverage ratio Debt ratio Equity multiplier ratio Times interest earned Total liabilities/ Total assets Total assets / Common equity EBIT / Interest 0.637 3.025 9.669 0.605 2.626 9.096 2.556 9.143 2019 2018 2017 0.013 Profit margin ROA ROE Profitability ratios Net income / Sales Net income / Total assets Net income / Common equity 0.030 0.092 0.020 0.048 0.127 0.028 0.069 0.175 DuPont Equation ROE = Net Margin x Asset turnover ratio x Equity multiplier 0.092 0.126 0.176 Microsoft Liquidity Year Current Ratio 2019 2.53 2018 2.9 2017 292 Year Quick Ratio 2019 2.35 2018 2.74 2017 2.37 Year Cash Ratio 2019 1.93 2018 2.29 2017 2.06 Dupont Analysis 2019 ROE 0.383 Profitable 2.154 Efficiency 0.063 Leverage 2.8 2018 ROE 0.2 Profitability 0.94 Efficiency 0.057 Leverage 3.129 2017 ROE 0.29 Profitable 1.648 Efficiency 0.061 leverage 2.85 Liquidity Year 2019 Current Ratlo 23 201 191 2018 2017 Year Quick ratlo 2019 221 1.94 1.86 2018 2017 Dupont analysis 2019 (-) 0.030 0.13% ROE Profitability Efficiency Leverage 2018 0.36 0.38 ROE Profitability 0.041 0.12% 0.26 Efficiency Leverage 0.23 2017 ROE Profitability 0.016 0.16% 0.33 Efficiency Leverage 0.13