Row 299 choices: Increase, decrease & flat

Row 301 choices: declining margins, issued more shares & margins first declined and then increased

Row 303 choices: Accretive, dilutive& neutral.

E 265 Revenue Growth and Company Life Cycle 266 We have selected five companies and 'indexed' their Revenues so that they are the same value at the starting year 1996. 267 Here we set all five companies Revenues for 1996 to $100. (FYI: To create an Index, divide every year's Revenues by 1996 Revenues and multiply that number by 100). 268 Financial analysts index time-series to a common starting point to compare the trends over time. 269 The graph on the left is the Revenues of these five companies over the past 25 years. 270 The graph on the right is the Revenues of all of these companies excluding Amazon over the past 25 years. Revenues 1996 = 100 Revenues 1996 = 100 1,600,000 400 1,400,000 350 1,200,000 300 1,000,000 250 800,000 600,000 150 400,000 T 200 100 200,000 50 &&&8 8 8 8 8 8 8 &&&&&&&&& &&&&8 8 8 WY X GE WY GE AMZN DIS X-DIS 271 272 Note: The above graph on the left shows all five time series but Amazon's growth was so great it dwarfed that of the other four. 273 For each of the following descriptions, select the related company: 274 Description Name 275 Hyper-growth 276 Growth 277 Decline 278 Mature cyclical 279 Mature non-cyclical 280 281 282 Net Margin and EPS Calculations 283 According to its website, IHS Markit is a company that combines information, analytics and expertise to provide solutions for business, finance and government'. 284 Below are selected financial results for the period 2015 to 2018. 285 In 2017 IHS merged with Markit resulting in a significant increase in revenues and expenses but also in Shares Outstanding. 286 In the yellow cells in column I, calculate the three-year compound annual growth rate (CAGR) from 2015 to 2018 for each row. 287 In Row 295 calculate the EPS for each year. 288 In Row 296 calculate the Net Margin Attributable to Common for each year. 289 Based on these results answer the questions below. 290 291 2015 2016 2017 2018 CAGR 292 Revenues 1,113 2,735 3,600 4,009 293 Net Income Attributable to Common 153 153 417 542 294 Shares Outstanding 190 316 416 295 Earnings per Share (EPS) 296 Net Margin Attributable to Common 297 298 Between 2015 and 2018 did the company's Net Margin increase, decrease or remain flat? 299 300 Between 2015 and 2018, why was company's EPS growth was so much lower than its revenue growth? 301 302 Relative to 2016 (before the merger) was the merger accretive (increased EPS), dilutive (decreased EPS), or neutral. 303 407 304