Question
You are the loan analyst and have received the information on a current page from the Accounting coordinator of plc. You have to analyze Burgas
You are the loan analyst and have received the information on a current page from the Accounting coordinator of plc. You have to analyze Burgas plc. and give your opinion of this company to the Credit Committee of BBB Bank.Which ratios should be taken into consideration if one is loan analyst and which one shouldn't among:
Gross/net/operating profit margin: gross/net/operating profit over revenue
Return on capital employed: Operating profit over capital employed
Return on Equity: Profit after tax over equity
Asset turnover: Revenue over (Assets less current liabilities)
Current ratio: Current assets over current liabilities
Quick ratio: Same as Current ratio but without inventory
Inventory period: Inventory over cost of sales multiplied by the total days in a year
Receivables collection period: Receivables over revenue multiplied by the total days in a year
Payables payment period: Payables over Purchases (you can use Cost of sales) multiplied by the total days in a year
Leverage ratios: these ratios look at the relationship of debt with equity
Interest cover: profit before interest over interest
Dividend yield: Dividend per share over mid-market price of share
Dividend cover: Net profit over dividend
Price/earnings ratio: Mid-market price over EPS
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