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The CFO of James Jeans Co. has asked you to perform an analysis to assess how the company is performing relative to its two
The CFO of James Jeans Co. has asked you to perform an analysis to assess how the company is performing relative to its two largest competitors. Which vertical analysis approach will provide the most effective evaluation to the CFO? Review the stock price performance of the three companies over the last several years and the Wall Street Analyst buy/sell recommendations: compare debt ratings; review messages on key business websites and blogs to learn what is being said about the company and competitors. Calculate cost of goods sold, selling and administrative expenses, and net income as a percentage of net sales for James Jeans and the two largest competitors; draw conclusions from these results and highlight similarities and differences. Identify the structure of the sales and marketing team of each company, gather information about customer product reviews, and review product warranty claims to understand the comparative performance. Analyze the size of each company's balance sheet and income statement accounts by calculating how much larger or smaller the competitors are compared to James Jeans Co.; summarize observations about what might be the reasons for these size differences.
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