Answered step by step
Verified Expert Solution
Question
1 Approved Answer
CP 17-5 Profitability analysis Deere & Company manufactures and distributes farm and construction machinery that it sells around the world. In addition to its manufacturing
CP 17-5 Profitability analysis Deere & Company manufactures and distributes farm and construction machinery that it sells around the world. In addition to its manufacturing operations, Deere's credit division loans money to customers to finance the purchase of their farm and construction equipment. The following information is available for three recent years (in millions except per- share amounts): Year 3 Year 2 Year 1 Net income (loss) $3,064.7 $2,799.9 $1,865.0 Preferred dividends $0.00 $0.00 $0.00 Interest expense $782.8 $759.4 $811.4 Shares outstanding for computing earnings per share 397 417 424 Cash dividend per share $1.79 $1.52 $1.16 Average total assets $52,237 $45,737 $42,200 Average stockholders' equity $6,821 $6,545 $5,555 MPS Average stock price per share $79.27 $80.48 $61.18 1. Calculate the following ratios for each year, rounding ratios and percentages to one decimal place, except for per-share amounts: a. Return on total assets b. Return on stockholders' equity c. Earnings per share d. Dividend yield e. Price-earnings ratio 2. Based on these data, evaluate Deere's profitability
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started