Each student will investigate two publicly traded companies within the same industry. A comprehensive financial ratio analysis is to be completed comparing your two companies to each other and then to a set of industry ratios. I will supply you with the industry ratios. This means calculating the ratios we discussed in chapter 3 (you will not do the Fixed Charge Coverage) for each company. You are to use the provided Excel spreadsheet to calculate your ratios. The Excel file includes the needed financial information for each company, the ratio name & formula, and the calculation. We will use the most recent year's annual report for each company. You will also prepare a 2-3 page, double-spaced, 12-point font analysis discussing each company's financial strengths/weaknesses and how the ratios compare to each other and to their industry. Your Ratio Project grade will be based on: Accuracy of your calculations Use of Excel I Content Composition When evaluating your analysis, I am looking for organization, understanding, depth of coverage, and clarity of thought. It should also be free of grammatical and spelling errors. TO ANOTINANCIAL MUASUNE MINI CALCULATIONS CALCULATIONS Company st FORMULA PROFITABILITY RATIO Pratit Mar Net incomales Return on net income/stockholders equity Return on Assets net income totala 10 LIQUIDITY RATIOS Current Ratio current assets/current liabilities Quick Ratio current assets-current inventory/current liabities DEBT UTILIZATION RATIOS Debt-to-Total Assets Total debdebt assets 15 net income interest 16 Tumesintetestamed ASSET UTILIZATION RATIOS Asset Turnover sales/total assest Receivables Turnover sales/recevables Fixed Asset Turnover sales/fixed assets 21 Inventory Yumove sale/ventory 22 25 Pharmacy CVS Annual Report.pdf Walgreens Annual Report.pdf CVS Annual Report.pdf Q anagement's Discussion and Analysis Financial Condition and Results of Operations Results of Operations Summary of Consolidated Financial Results Change Year Ended December 31 2018 2017 2017 2015 2018 2017 2016 S Reven Products S 163,010 $180.00 S573377 $ 3. Prema 8.184 3.55 3. 426 1300 Services 1.000 681 50.5 Net westment income 660 21 63 3,042 1 Torvet 194,570 1547 177.48 0.799 Operating costs Cost of products sold 156,447 153 S. 20 Benefit costs 6,594 2.17 2,784 1947 Goodwilmamente 6,140 5,968 3.297.25 Operating expenses 21,368 18.800 2.55 1365 ZON Total operating con 190,558 175.248 167.100 15.10 BE Operating income 4,021 10:36 15,5171 172 Interested 2,610 TOT 16. Lots on early extinguishment of debit 550000 Other experience 149 200 25 (2123 101.9 Income before income tax provision 1,406 8.200 15.03.01 HON Income tax provision 2,002 1,631 365 ROSEN Income fossi from continuing operations (5 6.63 5.300 17.2271 109.01% Los from discontinued option net of to . 100.0" Nel come 15061 0.000 7.219 1109.05 Not Income fos attributable to controlling interest 3 000 Netcome outlet CVS Hea $ 1041 5317 50.210 1100.00 Commentary - 2018 compared to 2017 Revenue Total revenues increased 59.8 bilion or 5.3% in 2018 compared to 2017. The increase in total revenues was due to a 27% increase in Pharmacy Services segment revenue a 58% Increase in Retail/LTC segment revenue and the impact of the Retne Acquisition primarily reflected in the Health Care Benefits segment, which occurred in November 2018 . Please see "Segment Analysis later in this document for additional information about the sevenom of the Company's grants Operating experises (including goodwill impairments) Operating expenses increased $8.5 billion or 44,9% in 2018 compared to 2017. The increase in operating experts was primarily due to higher operating expenses in the Retai/LTC segment including increased goodwimp charge in 2018 the impact of the Aetna Acquisition and an increase in acquisition related transaction and integration costs. The increas partially offset by a lack of charges associated with store closures in 2018 CVS Health Walgreens Annual Rep... 1718 TV8 7/1/18 - 7/31/18 8/1/18 - 8/31/18 31,855,404 9,714,240 41.569,644 64.13 67.93 565.00 31,855,404 41.569,664 41.569,664 STOXXOO000 7.956,840,007 7.296.39,059 5 7.296.839,059 In June 2018, Walgreens Boots Alliance authorized a stock repurchase program, which authorized the repurchase of up to $10.0 billion of Walgreens Boots Alliance common stock. This program has no specified expiration date . 37 616 Item 6. Selected financial data Five-Year Summary of Selected Consolidated Financial Data Walgreens Boots Alliance, Inc. and Subsidiaries (Dollars in millions, except per share amounts) hal ya 2012 2016 2014 Sales $131.537 $118.214 S117,351 S103.444 576.392 Cost of sales 100,74589,052 87,477 76,691 54,823 Gross profit 30,792 29,162 29.874 26,753 21.569 Selling general and administrative expenses 24.569 23.740 23.910 22.400 17.992 Equity camnings in Americe Bergen! 191 135 37 Equity earnings in Alliance Boots 315 617 Operating income 6,414 5.557 6,001 4.668 4,194 Gain on previously held equity interest 563 Other income (expense" 177 (11) (261) 685 (481) Earnings before interest and income tax provision 6.591 5.546 5,740 5.916 3.713 Interest expense, net 693 596 605 Eamings before income tax provision 5.975 4.853 5,144 5.311 3.557 Income tax provision 99% 760 997 1.056 1.526 Post tux carning from other equity method investments 54 44 24 Net camnings 5.031 4,101 4.191 4.279 2.031 Net earnings attributable to noncontrolling interests 7 18 59 99 Net camnings attributable to Walgreens Boots Alliance. Inc. $5.024 S 4.078 S 4.173 5 4.220 5 1932 Per Common Share Net earnings Basic $ 5.07 S 3.80 $ 3.85 S 4.05 5 203 Diluted 5.05 3.78 3.82 4.00 200 Dividends declared 1.640 1.525 1.455 1.373 1.283 Balance Sheet Total assets $ 68,134 $ 66,009 $ 72,688 S 68,782 537.250 Long-term debe 12.431 12.684 18,705 13,315 3.716 Total Walgreens Boots Alliance, Inc. shareholders' equity 26.007 27.466 29,880 30.861 20,513 Noncontrolling interests 682 401 439 104 Total equity $ 26,689 S 28.274 S 30.281 S 31,300 $20,617 Each student will investigate two publicly traded companies within the same industry. A comprehensive financial ratio analysis is to be completed comparing your two companies to each other and then to a set of industry ratios. I will supply you with the industry ratios. This means calculating the ratios we discussed in chapter 3 (you will not do the Fixed Charge Coverage) for each company. You are to use the provided Excel spreadsheet to calculate your ratios. The Excel file includes the needed financial information for each company, the ratio name & formula, and the calculation. We will use the most recent year's annual report for each company. You will also prepare a 2-3 page, double-spaced, 12-point font analysis discussing each company's financial strengths/weaknesses and how the ratios compare to each other and to their industry. Your Ratio Project grade will be based on: Accuracy of your calculations Use of Excel I Content Composition When evaluating your analysis, I am looking for organization, understanding, depth of coverage, and clarity of thought. It should also be free of grammatical and spelling errors. TO ANOTINANCIAL MUASUNE MINI CALCULATIONS CALCULATIONS Company st FORMULA PROFITABILITY RATIO Pratit Mar Net incomales Return on net income/stockholders equity Return on Assets net income totala 10 LIQUIDITY RATIOS Current Ratio current assets/current liabilities Quick Ratio current assets-current inventory/current liabities DEBT UTILIZATION RATIOS Debt-to-Total Assets Total debdebt assets 15 net income interest 16 Tumesintetestamed ASSET UTILIZATION RATIOS Asset Turnover sales/total assest Receivables Turnover sales/recevables Fixed Asset Turnover sales/fixed assets 21 Inventory Yumove sale/ventory 22 25 Pharmacy CVS Annual Report.pdf Walgreens Annual Report.pdf CVS Annual Report.pdf Q anagement's Discussion and Analysis Financial Condition and Results of Operations Results of Operations Summary of Consolidated Financial Results Change Year Ended December 31 2018 2017 2017 2015 2018 2017 2016 S Reven Products S 163,010 $180.00 S573377 $ 3. Prema 8.184 3.55 3. 426 1300 Services 1.000 681 50.5 Net westment income 660 21 63 3,042 1 Torvet 194,570 1547 177.48 0.799 Operating costs Cost of products sold 156,447 153 S. 20 Benefit costs 6,594 2.17 2,784 1947 Goodwilmamente 6,140 5,968 3.297.25 Operating expenses 21,368 18.800 2.55 1365 ZON Total operating con 190,558 175.248 167.100 15.10 BE Operating income 4,021 10:36 15,5171 172 Interested 2,610 TOT 16. Lots on early extinguishment of debit 550000 Other experience 149 200 25 (2123 101.9 Income before income tax provision 1,406 8.200 15.03.01 HON Income tax provision 2,002 1,631 365 ROSEN Income fossi from continuing operations (5 6.63 5.300 17.2271 109.01% Los from discontinued option net of to . 100.0" Nel come 15061 0.000 7.219 1109.05 Not Income fos attributable to controlling interest 3 000 Netcome outlet CVS Hea $ 1041 5317 50.210 1100.00 Commentary - 2018 compared to 2017 Revenue Total revenues increased 59.8 bilion or 5.3% in 2018 compared to 2017. The increase in total revenues was due to a 27% increase in Pharmacy Services segment revenue a 58% Increase in Retail/LTC segment revenue and the impact of the Retne Acquisition primarily reflected in the Health Care Benefits segment, which occurred in November 2018 . Please see "Segment Analysis later in this document for additional information about the sevenom of the Company's grants Operating experises (including goodwill impairments) Operating expenses increased $8.5 billion or 44,9% in 2018 compared to 2017. The increase in operating experts was primarily due to higher operating expenses in the Retai/LTC segment including increased goodwimp charge in 2018 the impact of the Aetna Acquisition and an increase in acquisition related transaction and integration costs. The increas partially offset by a lack of charges associated with store closures in 2018 CVS Health Walgreens Annual Rep... 1718 TV8 7/1/18 - 7/31/18 8/1/18 - 8/31/18 31,855,404 9,714,240 41.569,644 64.13 67.93 565.00 31,855,404 41.569,664 41.569,664 STOXXOO000 7.956,840,007 7.296.39,059 5 7.296.839,059 In June 2018, Walgreens Boots Alliance authorized a stock repurchase program, which authorized the repurchase of up to $10.0 billion of Walgreens Boots Alliance common stock. This program has no specified expiration date . 37 616 Item 6. Selected financial data Five-Year Summary of Selected Consolidated Financial Data Walgreens Boots Alliance, Inc. and Subsidiaries (Dollars in millions, except per share amounts) hal ya 2012 2016 2014 Sales $131.537 $118.214 S117,351 S103.444 576.392 Cost of sales 100,74589,052 87,477 76,691 54,823 Gross profit 30,792 29,162 29.874 26,753 21.569 Selling general and administrative expenses 24.569 23.740 23.910 22.400 17.992 Equity camnings in Americe Bergen! 191 135 37 Equity earnings in Alliance Boots 315 617 Operating income 6,414 5.557 6,001 4.668 4,194 Gain on previously held equity interest 563 Other income (expense" 177 (11) (261) 685 (481) Earnings before interest and income tax provision 6.591 5.546 5,740 5.916 3.713 Interest expense, net 693 596 605 Eamings before income tax provision 5.975 4.853 5,144 5.311 3.557 Income tax provision 99% 760 997 1.056 1.526 Post tux carning from other equity method investments 54 44 24 Net camnings 5.031 4,101 4.191 4.279 2.031 Net earnings attributable to noncontrolling interests 7 18 59 99 Net camnings attributable to Walgreens Boots Alliance. Inc. $5.024 S 4.078 S 4.173 5 4.220 5 1932 Per Common Share Net earnings Basic $ 5.07 S 3.80 $ 3.85 S 4.05 5 203 Diluted 5.05 3.78 3.82 4.00 200 Dividends declared 1.640 1.525 1.455 1.373 1.283 Balance Sheet Total assets $ 68,134 $ 66,009 $ 72,688 S 68,782 537.250 Long-term debe 12.431 12.684 18,705 13,315 3.716 Total Walgreens Boots Alliance, Inc. shareholders' equity 26.007 27.466 29,880 30.861 20,513 Noncontrolling interests 682 401 439 104 Total equity $ 26,689 S 28.274 S 30.281 S 31,300 $20,617