1. Need help with Times-Interest Earned Ratio to Price-Earnings Ratio

Course Project: A Financial Statement Analysis - A Comparative Analysis of Apple, Inc. and Alphabet, Inc.

Description

This course contains a Course Project, where you will be required to submit one draft of the project at the end of Week 6, and the final completed project at the end of Week 8. Using the financial statements for Apple Inc. and Alphabet Inc., respectively, you will calculate and compare the financial ratios listed further down this document and prepare comments about the two companies' performances based on your ratio calculations. The entire project will be graded by the instructor at the end of the final submission in Week 8, and one grade will be assigned for the entire project.

Financial Statements

Below is the link for the financial statements for Apple Inc. for the fiscal year ending 2017.

https://investor.apple.com/investor-relations/default.aspx(Links to an external site.)

When you arrive at this website, please do the following.

First, select SEC Filings, next select Annual Filings using the drop-down arrow labeled All Filings and then select 2017, using the drop-down arrow labeled Year,

You should select the 10-K dated 11/03/2017 and choose to download in PDF, HTML, or Excel format. The PDF format is the best format for searching.

Below is the link for the financial statements for Alphabet, Inc. for the fiscal year ending 2017.

https://abc.xyz/investor/(Links to an external site.)

First, scroll down to the bottom of the page and click on SEC filings and additional information. Next, click on Alphabet SEC filings. Type 10-K in as the Filing type and click Search. Click on Documents for the 10-K dated 2018-02-06. Finally, click on the link next to the Form 10-K. This will open the 10-K in HTML format which is searchable.

ASample Project Template(Links to an external site.)is available for download. The sample project compares the ratio performance of Nike and Under Armour using the 2014 financial statements of Nike and Under Armour provided at their websites.

Overall Requirements

For the Final Submission:

For the Final Submission:

Your final Excel workbook submission should contain the following. You cannot use any other software but Excel to finish project.

1.A Completed Worksheet Title tab, which is really a coversheet with the names of each team member, the course, the date, your instructor's name, and the title for the project.

2.A Completed Worksheet Profiles tab which contains a one-paragraph description regarding each company with information about their history, what products they sell, where they are located, and so forth.

3.All 16 ratios for each company with the supporting calculations and commentary on your Worksheet Ratio tab. Supporting calculations must be shown either as a formula or as text typed into a different cell. The ratios are listed further down this document. Your comments for each ratio should include more than just a definition of the ratio. You should focus on interpreting each ratio number for each company and support your comments with the numbers found in the ratios. You need to specifically state which company performed better for each ratio.

4.The Summary and Conclusions Worksheet tab is an overall comparison of how each company compares in terms of the major category of ratios described in Chapter 13 of your textbook. A nice way to conclude is to state which company you think is the better investment and why.

5.The Bibliography Worksheet tab must contain at least your textbook as a reference. Any other information that you use to profile the companies should also be cited as a reference as well as the links to the financial statements.

Required Ratios for Final Project Submission

1.Earnings per Share of Common Stock

2.Current Ratio

3.Gross Profit Rate

4.Profit Margin

5.Inventory Turnover

6.Days in Inventory

7.Accounts Receivable Turnover

8.Average Collection Period

9.Asset Turnover

10.Return on Assets (ROA)

11.Debt to assets Ratio

12.Times Interest Earned Ratio

13.Dividend Yield[For the purposes of this ratio, use Yahoo Finance to look up current dividend per share and stock price; just note the date that you looked up this information.]

14.Return on Common Stockholders' Equity (ROE)

15.Free cash flow

16.Price-Earnings Ratio [For the purpose of this ratio, look up the market price per share as of September 28, 2017 for Apple Inc. and for Alphabet, Inc. use December 29, 2017]

Net sales $229,234 $1 10,855 Profit Margin Net income $48,351 21.1% $12.682 11. 4% Good Net sales $229.234 $ 1 10.855 Inventory Turnover Cost of goods sold $141.048 40 4 $45,583 39.6 Good . Average inventory $3.494 $509 Good . Days in Inventory 365 days 365 385 Inventory turnover 40.4 days 89 6 days Accounts Receivable Turnover Net credit sales $229.234 136 $1 10 855 8.8 Good . Average net accounts receivable S16 814 $16.237 Average Collection Period 365 days 385 27 365 53 Good . Accounts receivable turnover 13.8 days 68 days Asset turnover Net sales $229.234 0.68 $1 10.855 0.61 Good . Average total assets $348.503 $182,396 Return on Assets (ROA) Net income $48.351 13 96 S12 682 8:9% Good . Average total assets $348,503 $182.396 4 Debt to assets ratio Total Liabilities $241 272 84 3% $44.793 22.7% Good . Total Assets $375.319 $197 295 Times-Interest Earned Ratio Net income + interest expense + income tax expense 501.344 26 4 26,146 239.9 Both numerators are off a bit. Please take another look. interest expense $2,323 109 51 No Dividend The dividend figure for the year for apple is too low. Also, use the stock price as of the 2 Dividend Yield 53 (Please follow the Course Project instructions to calculate the current dividend yield.) Dividend per share of common stock (Yahoo Finance 12/24/2015) $0 82 Paid #VALUE! balance sheet date 54 Market price per share of common stock (Yahoo Finance 12/24/2015) $111.11 56 Return on Common Stockholders' Equity (ROE) 48 351 238 16 12.662 8 36 56 Net income - preferred dividends 152 502 00 Both numerators are off. Did you average the Stockholder's equity. 57 Average common stockholders' equity 134 047.00 58 159 F $63.598 Free cash flow $37.091 Net cash provided by operating activities minus capital expenditures minus cash dividends $16 930 $14.252 Both are too low. All figures should appear on the cash flow statement. 61 62 in millions in thousands 83 Price-Earnings Ratio 64 (Please see the Course Project instructions for the dates to use for this ratio.) Market price per share of common stock as of 5/30/20 14 for Nike and 12/31/2014 for Under Armour $38 32 Earnings per share $1.046.40 57 The stock price for Apple is too low. Also, check your decimal places for both numerator $9 27 $18 27 and denominator for Alphabet. The result is correct, while the figures in the calculation 65