Question
Using the financial statements of Target Corporation, give a brief explanation of each ratio, how it is used in business performance evaluation. Compute each of
- Using the financial statements of Target Corporation, give a brief explanation of each ratio, how it is used in business performance evaluation. Compute each of following ratios for the most recent year and the previous year. Assume all sales are credit sales. Round all ratios to two decimal places.
-Current ratio
-Cash ratio
-Inventory turnover
-Accounts receivable turnover
-Gross profit percentage
-Debt ratio
-Debt to equity ratio
-Profit margin ratio
-Asset turnover ratio
-Rate of return on common stockholders' equity
-Earnings per share
-Price/earnings ratio
-Dividend yield
-Dividend payout
-Compare the Targets performance for the two most recent years. What do you see? Draw conclusions. Base your answer on the company's ability to pay current liabilities, ability to sell merchandise and collect receivables, ability to pay long-term debt, profitability, and attractiveness as an investment.
-As an investor - Do you consider this an optimal analysis for determining whether to invest in Target corporation? Why or why not?
-How is Target corporation performing? What areas do you think need attention/improvements? What would be your recommendation/plan of action?
-The conclusion should be built on the information you provided.
Link to Target Corporation report: https://www.sec.gov/Archives/edgar/data/27419/000002741919000006/tgt-20190202x10k.htm
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