The Sherwin-Williams Company

Introduction The Sherwin-Williams Company by explaining its industry, including the mention of two or three competitors. Explain how the company produces its profits. In other words, explain how it makes money. Write this so that any reader can clearly understand how the company sells its products and/or services to generate profits.

evaluate The Sherwin-Williams Company financial strengths and weaknesses. You can start by comparing the most recent year to the previous two years with graph below. You may also evaluate the companys performance compared to its industry data ( please see graphs below. Finally, comment on the strength or weakness of the ratio itself. For example, an ROE of 15% or more is a strong indication of the companys profitability regardless of how it compares to other data. In addition, you should include a common size analysis of your companys income statement. This may provide additional insight for evaluating the companys operating results.

Your overall assessment needs to focus on financial strengths and weaknesses identified, not on one or two poor ratios. This section of the report should be approximately 2-4 pages including the tables.

Financial Ratio	Formula	2015	2014	2013	Comments
Current ratio	Total Current Assets/Total Current Liabilities	0.54	0.55	0.69
Quick ratio	(Cash and Equivalents + marketable Securities + Receivables)/Total Current Liabilities	0.29	0.27	0.42
Inventory turnover	Cost of Goods Sold/Average Inventory	5.63	5.95	5.74	For calculating Inventory turnover of year 2013, we need the 2012 inventory levels. For approximation we have used 2013 inventory instead of average inventory levels for year 2013
Days sales outstanding (DSO)	Accounts Receivables * Number of days/Total Credit Sales	38.17	40.10	42.49	Here it is assumed that all sales is credit sales as the breakup of credit sales in not given
Fixed asset turnover	Net Sales/Average net Fixed assets	10.99	10.90	9.97	For calculating Average net fixed assets of year 2013, we need the 2012 fixed assets. For approximation we have used 2013 fixed assets instead of average fixed assets for year 2013
Total asset turnover	Net Sales/Average Total net assets	1.97	1.84	1.60	For calculating Average total net assets of year 2013, we need the 2012 net assets. For approximation we have used 2013 net assets instead of averagetotal net assets for year 2013
Total debt to total capital	Total Debt/Total Capital	0.69	0.64	0.49

Times interest earned (TIE)	EBIT/Total Interest Payable	26.07	20.60	18.32
Operating margin	EBIT/Revenue	0.14	0.12	0.11
Profit margin	Net Income/Revenue	0.09	0.08	0.07
Return on total assets (ROA)	EBIT/Total Net Assets	0.29	0.24	0.19
Return on common equity (ROE)	Net Income/Shareholder's equity	1.21	0.87	0.42
Return on invested capital (ROIC)	(Net Income - Dividend)/ Total Capital	0.28	0.23	0.16
Basic earning power (BEP)	EBIT/Total Assets	0.28	0.23	0.18
Price/earnings (P/E)	Stock Price/Earnings	Data Needed	Data Needed	Data Needed	Price and No. of shares outstanding data required COULD NOT FIND IN YAHOO FINANCE

Market/book (M/B)

Market Price/Book Value per share

Data Needed

Data Needed

Data Needed

Price and No. of shares outstanding data required COULD NOT FIND IN YAHOO FINANCE

	ROE	Profit Margin	Total Asset Turnover	Equity Multiplier
2015	1.21	0.09	1.97	6.62
2014	0.87	0.08	1.84	6.07
2014	0.42	0.07	1.60	3.60