In brief, financial analysis is the process of selection, relation and evaluation.(Khan, M Y, ). Financial performance analysis is, therefore, the process of identifying the financial strengths Financial statements (or financial reports) are formal records of the financial activities and position of a business, person, or other entity.. Relevant financial information is presented in a structured manner and in a form which is easy to understand. They typically include four basic financial statements accompanied by a management discussion and analysis In this research paper, we examine the financial performance from the years to of one of the biggest companies in the world which is the Coca Cola Company. Financial analysis
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Analysis of Financial Statement Formal Assignment Report. Amirtha Chetlur. Download Download PDF Full PDF Package Download Full PDF Package This Paper.
A short summary of this paper. Brief Review Analysis of Financial Financial analysis paper A Estimation of Value of Stake in the Competitor To go further with the topic, the report financial analysis paper a specific company to make progress McMillan, The selection of the company had come across a certain criteria which are that the company should not be some financial service provider and it should be listed under FTSE.
Now FTSE is share price index and it is the subsidiary group of the London Stock Exchange. The stock indices of it are widely used by the world and also the analytical firms as well Ohlson, So the stock indices are particular thing that can measure financial analysis paper high performance of the business according to the regulation of company law of UK.
The report should be published in a form that can be helpful for the senior executives of the company, financial analysis paper. Here in this report the certain financial and operation perspectives of the specifically selected company will be discussed with making the proper analysis Saunders, The performed analysis done in this report is strongly based on the calculation of ratios and the reflection that those have to say about the company.
As per the description and the regarding on the basis of criteria maintained, the company of Sports Direct International plc is selected as it is assumed that the company financial analysis paper appropriate to investigate further with the report. The following portion of the report will be based on this certain company and part of analysis will be done accordingly. Brief Review Sports Direct International plc is a group of British retailing industry and the name of the founder of this company is Mike Ashley who situated this company in The company is a multinational company and it proved to be the largest sporting retailer in the country of UK and it has overall stores worldwide, financial analysis paper.
Sporting goods and equipments are sold by the company Weygandt, The large number of sporting brand is covered by the company and also does the business on the basis of sportsdirect. com brand. The future aim of the company is concentrated on opening more stores in the part of the mainland Europe, financial analysis paper.
So the company is looking for the opportunity to do business in the parts of Europe and keeping the fact on their side to expand globally. The entire planning, growth strategy and the business operation which deals with future aims and objectives of the company is clearly observed as to stay ahead of the other market competitors and remain at the top position where all the competitive advantages can be gained.
Analysis of Financial Performance The purpose of this section is to give a close attention to the financial perspective of Sports Direct Plc by computing and comparison of the ratios to its perspective years of operation. Profitability, efficiency and liquidity are fields what are chosen in this analysis for reflecting the effects based on the ratios.
A maximum extent of current three years is considered for this purpose Palmer, The company is currently operating in its sporting goods sector in UK and come out to be the largest sporting retailer in UK. According to the relevant reports from the sources considering the profile of the company, it is revealed that the company is currently holding the top financial analysis paper in UK in terms of the sporting retailer financial analysis paper the In an addition to the sporting sector, financial analysis paper, Sports Direct has spread its other services in the market as well including the dealings with the fashionable brands for capturing the global market McMillan, So splitting the ratios in the areas of Profitability, Efficiency and Liquidity, the financial standings and performance of Sport Direct can be determined by following with a proper analysis, financial analysis paper.
Liquidity Ratio The measurement of liquidity ratio is done on the basis of checking the ability of the financial analysis paper to pay off its short-term obligations, financial analysis paper.
The short term standing of the company is measured by this type of ratios. Here the short-term is focused as the debts that are due for the company and to be paid within one year time duration Black, For this concern, the desired result from the ratios are expected to be higher as the more higher the value is, financial analysis paper, the more the company is capable to pay its debts.
As for the examples, the shareholders or the investors will look for the higher value of current assets that the total value of current liabilities as it indicates the fact that the company can repay all its short term debts within a short period of time if necessary Rao, But a higher value should not be expected as it suggests that the company is not utilizing its current assets properly during the running of the business, financial analysis paper.
Current Ratio - Current ratio is one major part of the liquidity ratio as it suggests the capability of the company to repay it short term debts which financial analysis paper be the accounts payables and others with support of current assets such as cash, accounts receivables and inventories. Depending on the cash flow and types of industries, the financial analysis paper of the current ratio can vary but a desired result of is always considered as the benchmark for analysis.
The reason behind this, the inventory is considered that it can be converted into cash very enthusiastically McMillan, Giving an example, the company may allow discounts to the customers to finish their inventories fast and generate cash from the activity, financial analysis paper. So the changing value of the inventories can be often found as it could be lower in amount that the recorded value in the financial statements.
This could be the reason as the trade receivables are lower than the trade payables in order to run the business efficiently Lewis, The business has a high level of turnover and from that it can generate cash easily and can be utilized for repayment of debts, financial analysis paper.
On the other hand, the investors or the shareholders will not face a concern about the lower ratios for this kind of multinational business as they will expect a higher value from the other small businesses Sanzo, Also the drawback of the higher receivables can be observed as it may be risky for the company due to the inability of some of the customers regarding the payment of debts.
So financial analysis paper ratios are too much important to make the analysis. Earnings per Share EPS —this ratio is important for the shareholders as they calculate the earnings available in respect of each share held in the company. They can able to determine the available earning from them if they own shares in the company.
The comparison can be made with the dividends to determine about the payout ratio. It is quite important for the shareholders to gather knowledge that the company is using its incomes to sort off the capital expenditures or paying dividends Weygandt, If they found that the dividends are low then they expect higher capital expenditure which can maximize the future value of the business along with it increases the share prices and capital gains. Gross Profit Margin and Net Profit Margin — gross profit margin indicates the deduction of cost of goods sold from the revenues.
The efficiency of the production level of company is determined via gross profit margin. On the other side, net profit margin indicates the net income of the company once all the related costs are being deducted. The determination of the factors like rising costs or competition can be done with it. Return on Equity Return on equity is considered as one of the vital measure of profitability of the company higher value of return on equity proves to be crucial and fruitful for the company.
The return on equity is fluctuating which indicate that the company is not efficient in generating income on new investment. Increase in the return on invested capital indicates that the company is generating more earning per dollar of capital employed.
According to the calculation, financial analysis paper, based on the position of the company considering the margin, financial analysis paper, the company of Sport Direct Plc is enjoying the favourable position that other competitors in the market Robinson, The greater margin compared to the market competitors is achieved by the company for giving the preference to the varieties of brand sold by the company for conducting the business and also maintaining the growth.
Also the online presence of the company gives it the advantage of lowering the overheads involved in the operation Plummer, Considering the latest scenario, the company has taken a charge of £1. Efficiency Ratios The main purpose of these ratios are to indicate the ability of the company on how efficiently it is utilizing its assets as well as liabilities to produce more revenues for the business operation McMillan, Sales to Inventory — sales to inventory ratio is considered in this case to make a clear understanding of the efficiency of the proposed company as compared to the peers of the business.
The results are not as good as it desired to be and also they are not at a faster pace as well. The reduction to the waste is important for the retailing industries which should be effective in the case of this company. So it is recommended that the company should pay more attention towards its efficiency level as it needs to maintain a faster rate regarding this ratio.
Dividend yield Dividend Yield of the company sports direct is 2. Dividend yield helps to provide a clear and precise idea about the company revenue generation and their required distribution among the different stakeholder. The dividend yield of the company is more than 1, financial analysis paper. Dividend yield is considered as a measure of investor return.
A Estimation financial analysis paper Value of Stake in the Competitor The nearest rival or the competitor for the company of Sports Direct Plc is the JJB Sports Plc which is based on the same industry as the selected company is in. The company also falls under the sports industry of retail business, also same as the company that is selected for the report Horrigan, financial analysis paper, The fate of this company is in the bankrupt situation where the shares are suspended and the administrators are called in.
according to the report published in the year of in October, the part of the business of the company is owned by Sport Direct already Black, So the centre of attraction by Sports direct regarding the competitor aspect will always be on acquiring this company and taking control of the entire operation.
It is also give the added supplement to the expansion plan of the current company Morley, JJB Sports Plc, financial analysis paper. On the basis of that above identified aspect, it is financial analysis paper to estimate the value on the basis of proper calculations Weygandt, Year Total Stake Holding The valuation of the stake also changes on the basis of the time period of the holding.
The company is also planning to do business outside the grocery market which will also provide it the added benefits comparing to the other competitors in the market. After the analysis, the growth factor for the company is evident and it is reflected in their ways of doing the business operation, financial analysis paper.
Analysis on the dividend will suggest that the shares in the company are going down at a The company should look into the matter of earning per shares, earning in the form of dividends and the payout ratio as well to improve such situation Bierman and Smidt, The extensive offering in both market of UK and internationally has favored a lot to Sports Direct Plc, so it is recommended that the company should look for the various other opportunities to maintain the factor and also to be able to increase it stimulatingly Wild, et al.
Based on the discussion, the company is recommended that it should carry on the planning behind the process of extending the business by continuing the European operations and maximizing the availability of financial analysis paper brands Bradford, It can able to raise the margin of the company after the overall UK margin was hit since the FY results cause a downfall of 5.
How to do Financial Analysis of a Company in Excel - Full Tutorial for Beginners from Scratch
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The Journal of Financial and Quantitative Analysis (JFQA) publishes theoretical and empirical research in financial blogger.com include corporate finance, investments, capital and security markets, and quantitative methods of particular relevance to financial researchers Formal Analysis Paper Example 1 Formal Analysis Paper Example 2 Formal Analysis Paper Example 3 Oct 23, · Abstract. We develop a framework to theoretically and empirically analyze the fluctuations of the aggregate stock market. Households allocate capital to institutions, which are fairly constrained, for example operating with a mandate to maintain a fixed equity share or with moderate scope for variation in response to changing market conditions
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