Has J&W's liquidity position improved or worsened? Explain

Has J&W's ability to manage its assets improved or worsened? Explain

How has J&W's profitability changed during the last year?

Perform an extended DuPont analysis for J7W for 2015 and 2016. What do these results tell you?

Perform a common size analysis. What has happened to the composition (That is, the percentage in each category) of assets and liabilities?

Perform a percentage change analysis. What does this tell you about the change in profitability and asset utilization?

2016 2015 Industry Avg 2.44 1.17 2.52 1.41 2.58 1.53 3.81 45.63 1.92 1.11 5.64 43.80 2.00 1.22 7.69 47.45 2.04 1.23 Ratio Analysis Liquidity Ratios Current Ratio Quick Ratio Asset Management Ratios Inventory Turnover (Total COGS/Inve Days Sales Outstanding Fixed Assets Turnover Total Assets Turnover Debt Management Ratios Debt Ratio (Total debt-to-assets) Liabilities-to-assets ratio Times-interest-earned ratio EBITDA coverage ratio Profitability Ratios Profit Margin Basic Earning Power Return on Assets Return on Equity Market Value Ratios Earnings per share Price-to-earnings ratio Cash flow per share Price-to-cash flow ratio Book Value per share Market-to-book ratio 5.3% 35.2% 12.67 3.66 2.0% 33.2% 13.90 3.39 20.0% 32.1% 15.33 4.18 9.57% 19.16% 10.59% 16.35% 8.63% 18.95% 10.55% 15.80% 8.86% 19.48% 10.93% 16.10% $9.92 9.07 $14.77 6.09 $93.70 0.96 $8.63 11.12 $13.13 7.31 $81.81 1.17 NA 10.65 NA 7.11 NA 1.72 a. Has Joshua & White's liquidity position improved or worsened? Explain. b. Has Joshua & White's ability to manage its assets improved or worsened? Explain. c. How has Joshua & White's profitability changed during the last year? d. Perform an extended Du Pont analysis for Joshua & White for 2008 and 2009. ROE = PM TA Turnover x Equity Multiplier 2016 16.35% 9.57% 1.11 1.54 2015 15.80% 8.63% 1.22 1.50 e. Perform a common size analysis. What has happened to the composition (that is, percentage in each category) of assets and liabilities? Common Size Balance Sheets 1 Assets 2 Cash and cash equivalents Short-term investments 4 Accounts Receivable 5 Inventories 3 Total current assets 7 Net fixed assets Total assets 2016 5.5% 1.0% 13.8% 22.1% 42.5% 57.5% 100.0% 2015 6.1% 1.0% 14.7% 17.1% 38.9% 61.1% 100.0% Liabilities and equity Accounts payable 2 Accruals 3 Notes payable 1 Total current liabilities 5 Long-term debt Total liabilities Common stock Retained Earnings Total common equity Total liabilities and equity 2016 8.9% 3.3% 5.2% 17.4% 17.8% 35.2% 48.4% 16.4% 64.8% 129.5% 2015 9.8% 3.7% 2.0% 15.4% 17.8% 33.2% 54.5% 12.2% 66.8% 133.5% Common Size Income Statements Sales 4 COGS except excluding depr. and amo 5 Depreciation and Amortization Other operating expenses 7 EBIT B Interest Expense Taxes (40%) Net Income 2016 100.0% 71.4% 4.7% 6.6% 17.3% 1.4% 16.0% 6.4% 9.6% 2015 100.0% 74.5% 4.5% 5.5% 15.5% 1.1% 14.4% 5.8% 8.6% 7 f. Perform a percent change analysis. What does this tell you about the change in profitability 8 and asset utilization? 9 O Percent Change Balance Sheets Base 1 Assets 2016 2015 2 Cash and cash equivalents 5.0% 0.0% 3 Short-term investments 16.0% 0.0% 4 Accounts Receivable 9.4% 0.0% 5 Inventories 50.0% 0.0% 6 Total current assets 26.7% 0.0% 7 Net fixed assets 9.2% 0.0% 8 Total assets 16.0% 0.0% 9 0 Base 1 Liabilities and equity 2016 2015 2 Accounts payable 5.0% 0.0% 3 Accruals 5.0% 0.0% 4 Notes payable 207.5% 0.0% 5 Total current liabilities 31.0% 0.0% 6 Long-term debt 16.0% 0.0% 7 Total liabilities 23.0% 0.0% 8 Common stock 3.0% 0.0% 9 Retained Earnings 55.2% 0.0% 0 Total common equity 12.6% 0.0% 1 Total liabilities and equity 16.0% 0.0% 2 3 Base 4 Percent Change Income Statements 2016 2015 5 Sales 5.0% 0.0% 6 COGS except excluding depr. and amo 0.7% 0.0% 7 Depreciation and Amortization 9.2% 0.0% 8 Other operating expenses 25.5% 0.0% 9 EBIT 17.3% 0.0% o Interest Expense 28.7% 0.0% 1 EBT 16.4% 0.0% 2 Taxes (40%) 16.4% 0.0% 3 Net Income 16.4% 0.0% 4 5 6 7 8