Question
Walmart Corporation is a national retail department store. The companys total revenues for the twelve months ended December 31, 2021, were $19 billion. Freshco is
Walmart Corporation is a national retail department store. The companys total revenues for the twelve months ended December 31, 2021, were $19 billion. Freshco is a larger department store company with $26.1 billion of revenues for the same period.
Ratio | Walmart | Freshco |
Gross Profit Percentage | 35.9% | 39.1% |
Net Profit Margin | 1.7% | 2.6% |
Return on Equity | 5.9% | 16.8% |
EPS | $3.27 | $2.13 |
Inventory Turnover Ratio | 2.69 | 2.64 |
Current Ratio | 1.68 | 1.31 |
Debt-to-assets | 0.64 | 0.82 |
P/E ratio | 12.6 | 15.1 |
Required: MUST EXPLAIN 4TH QUESTION LONG PLEASE..
1. Which company appears more profitable? Describe the ratio(s) that you used to reach this decision.
2. Which company appears more liquid? Describe the ratio(s) that you used to reach this decision.
3. Which company appears more solvent? Describe the ratio(s) that you used to reach this decision.
4. Are the conclusions from your analyses in requirements 13 consistent with the value of the two companies, as suggested by their P/E ratios? If not, offer one explanation for any apparent inconsistency.
HINT: The stock price in the top of the P/E ratio represents investors expectations about future financial performance whereas the bottom number reports past financial performance
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