Question
You used pages 235-241 of your textbook to do your assignment last week. For this week's written assignment, go back to those pages, and calculate
You used pages 235-241 of your textbook to do your assignment last week. For this week's written assignment, go back to those pages, and calculate the growth trend in revenue and net income from the second to the last and the last year (fiscal year ending 2009 to fiscal year ending 2010); and the financial ratios for all the six companies for the last fiscal year of data in the tables: (note you already did The Gap and Abercombie&Fitch last week so you just need to do it for the 4 other companies - Limited, American Eagle Outfitters, Urban Outfitters, Aeropostale)
1. Calculate year-to-year growth in total revenues for the last year (your answer will be one growth rate - 2010 increase from 2009 in percent) for each of the six companies.
2. Calculate year-to-year growth in total net income for the last year (one growth rates - 2010 increase from 2009 in percent as in above) for each of the six companies.
3. Provide the market value of the company (stock price multiplied by shares outstanding) for each of the six companies.
4. Provide the price to earnings ratio (stock price divided by earnings per share) for each of the six companies just for the last year.
5. Provide the return on sales or net profit margin (Net income divided by revenue or sales) for each of the six companies just for the last year.
6. Provide the return on equity (Net income divided by Total equity) for each of the six companies just for the last year.
7. Provide the total liabilities to equity (Total liabilities divided by total equity) for each of the six companies just for the last year.
After calculating #1 to #7 for all 6 companies, rank the six companies from best to worst in terms of lending to the companies. Which company is the best credit risk and which company will be able to borrow more money based on the financial trends and numbers? (if you know how to use an Excel spreadsheet it will be useful to create columns for each company so you can compare numbers easily, the rows will be #1 to #7)
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