Your assignment is to use all of the financial statements provided along with the financial ratios to analyze the financial health of each company.

From the information provided, what really stands out?

What do you see that is good?

What do you see that is not-so-good?

What is your overall impression of each company? Remember this investor is not an accountant, so you need to clearly explain your analysis.

Once an analysis has been completed for each company, make a comparison between the companies. From all of the information provided, determine which company your client should invest in and make sure you justify your recommendation based upon the financial analysis completed.

Macy's Inc Income statement for the year ended Dillard's Inc Income statement for the year ended

	2/3/2018		1/28/2017				2/3/2018		1/28/2017
Total revenue	24, 837, 000	100%	25, 778, 000	100%		Total revenue	6,422,676	100%	6,418,009	100%
Cost of revenue	15,152,000	61%	15,621,000	60.6%		Cost of revenue	4,199,718	65.4%	4,166,411	64.9%
Gross Profit	9,685,000	39%	10,157,000	39.4%		Gross Profit	2,222,958	34.6%	2,251,598	35.1%
Operating Expenses:						Operating Expenses:
Selling General & Administrative Expenses	8,131,000	32.7%	8,474,000	32.9%		Selling General & Administrative Expenses	1,720,157	26.8%	1,681,612	26.2%
Net Operating Expenses	13,000	0.1%	46,000	0.2%		Net Operating Expenses	231,595	3.6%	243,657	3.8%
Operating Income	1,541,000	6.2%	1,637,000	6.4%		Operating Income	271,206	4.2%	326,329	5.1%
Other Income/(Expenses):						Other Income/(Expenses):
Interest Expense	(321,000)	-1.3%	(367,000)	-1.4%		Interest Expense	(61,326)	-1.0%	(61,373)	-1.0
Net Interest Expenses	287,000	1.2%	(318,000)	-1.2%		Net Interest Expenses	3,644	0.1%	(7,236)	-0.1%
Net Income b4 Taxes	1,507,000	6.1%	952,000	3.7%		Net Income b4 Taxes	213,524	3.3%	257,720	4.0%
Income Tax Expense	(40,000)	-0.2%	333,000	1.3%		Income Tax Expense	(7,800)	-0.1%	88,500	1.4%
Net Income	1,547,000	6.2%	619,000	2.4		Net Income	221,324	3.4%	169,220	2.6%
Macy's Inc Statement of cash flows	For the Year ended 2/3/2018		Dillard's Inc Statement of cash flow	For the year ended 2/3/2018
Operating Activities			Operating Activities
Net Income	1,547,000		Net Income	221,324
Depreciation	991,000		Depreciation	232,357
Adjustments to Net Income	(251,000)		Adjustments to Net Income	(106,926)
Changes in Accounts Receivable	120,000		Changes in Accounts Receivable	8,580
Changes in Liabilities	(250,000)		Changes in Liabilities	(19,615)
Changes in Inventories	221,000		Changes in Inventories	(57,158)
Changes in Other Operating Activities	(320,000)		Changes in Other Operating Activities	(195)
Net Operating Activities	(114,000)		Net Operating Activities	(4,082)
Net Cash Inflow from Operating Activities	1,944,000		Net Cash Inflow from Operating Activities	274,285
Investing Activities			Investing Activities
Capital Expenditures	(487,000)		Capital Expenditures	(130,464)
Investments	-		Investments	3,460
Other Cash Flows from Investing Activities	(24,000)		Other Cash Flows from Investing Activities	5,114
Net Investing Activities	138,000		Net Investing Activities	11,683
Net Cash Outflow from Investing Activities	(373,000)		Net Cash Outflow from Investing Activities	(110,207)
Financing Activities			Financing Activities
Dividends Paid	(461,000)		Dividends Paid	(9,424)
Net Borrowings	(969,000)		Net Borrowings	(90,483)
Other Cash Flows from Investing Activities	12,000		Other Cash Flows from Investing Activities	(1,115)
Net Financing Activities	5,000		Net Financing Activities	(223,013)
Net Cash Outflow from Financing Activities	(1,413,000)		Net Cash Outflow from Financing Activities	(324,035)
Net Cash Inflow	158,000		Net Cash Inflow	(159,957)
Effect of Exchange Rate Changes			Effect of Exchange Rate Changes	-
Total Net Cash Inflow	158,000		Total Net Cash Inflow	(159,957)
Add Beginning Cash	1,297,000		Add Beginning Cash	346,985
Ending Cash	1,455,000		Ending Cash	187,028
Macy's				Dillard's
	2018	2017		2018	2017
Working Capital	2,369,000	1,979,000		690,150	861,404
Current Ratio:	1.47	1.35		1.66	1.88
Quick Ratio:	0.45	0.39		0.26	0.44
Accounts Receivable Turnover:	56.13			146.17
Number of Days' Sales in Receivables	6.50			2.50
Inventory Turnover	2.87			2.93
Number of Days' Sales in Inventory	127.40			124.72
Debt Ratio	0.71	0.78		0.53	0.56
Ratio of Fixed Assets to Long Term Liabilities	0.77	0.71		1.83	1.50
Ratio of Liabilities to Stockholders' Equity	2.42	3.59		1.15	1.26
Ratio of Net Sales to Assets	1.27			1.70