Description
- Create your Assignment submission and be sure to cite your sources, use APA style as required, check your spelling.
Assignment:
Assignment: In this benchmark assignment we are seeking your ability to research companies and determine their strength as a business.
Return to Yahoo Finance for the healthcare sector. http://finance.yahoo.com/sector/healthcare. Select three different companies that are in the same sector of the industry (example: healthcare provider, insurer, manufacturer, etc.) and click on their symbol in order to view their financial statement.
Carry out the ratio calculations for all financial ratios as described on pages 644-653 of the text. Present the results of your analysis along with all ratios in a spreadsheet and answer the following questions:
- Which company exhibits the strongest financial ratios?
- Identify any possible weaknesses that you observe in the financial ratios of any of the three companies. Describe what you observe, discuss the implications for the company, and explain actions you might take to improve ratios that suggest weakness.
- Present your findings in a spreadsheet accompanied by a one-page report summarizing your findings, analysis, and conclusions.
Assignment Expectations:
- Length:
- 1000-1250 words in essay format; answers must thoroughly address the questions in a clear, concise manner
- Structure:
- Include a title page and reference page in APA style. Separate each section in your paper with a clear heading that allows your professor to know which bullet you are addressing in that section of your paper. Support your ideas with at least three (3) citations in your essay. Make sure to reference the citations using the APA writing style for the essay. The cover page and reference page do not count towards the minimum word amount.
- References:
- Include the appropriate APA style in-text citations and references for all resources utilized to answer the questions
Explanation & Answer
Attached. Please let me know if you have any questions or need revisions.
Profitability Ratios
Liquidity Ratios
Debt Management Ratios
Gross margin
41,531/51,750 * 100 = 80.25%
Current ratio
32,803/37,304 = 0.88
Debt Ratio
52,145/167,489 * 100 = 31%
Operating margin
Days cash in hand
Debt-to-capitalization
35,955/35,955 + 63,143 * 100 = 3
13,921/51,750 * 100 = 26.9%
9,830/37,829-4,610/365 = 108 days
Times Interest Earned
Return on Assets
19,256/1,574 = 12.23
16,269/167,489 * 100 = 9.7%
Cash Flow Coverage
Return on Equity
16,269/ 63,143 * 100= 26%
N/B: Values from financial statements reported in '000
Values used are from fiscal period 2019
19,256 + 4,610/1,574 + 52,145 (1
Asset Management Ratio
Fixed Asset Turnover
51,750/134,685 = 0.38
Total Asset Turnover
51,750/ 167,489 = 0.31
Days in accounts receivable
12,068/51,750/365 = 85 days
Age of plant
6,010/4610 = 3.1 years
Profitability Ratios
Liquidity Ratios
Debt Management Ratios
Gross margin
4,807/104,213 * 100 = 4.6%
Current ratio
41,304/ 20,599 = 2
Debt Ratio
20,085/ 77,453 * 100 = 26%
Operating margin
4,807/104,213 * 100= 4.6%
Days cash in hand
Debt-to-capitalization
17,787/17,787 + 31,728 * 100= 3
4937 + 20,698/(98,228-338)365 = 95.5 days
Return on Assets
Times Interest Earned
6,731/746 = 9.0
4,807/77,453 * 100 = 6.2%
Cash Flow Coverage
Return on Equity
4,807/31,728 * 100 = 15.2%
6,731 + 338/ 746 + 20,085 (1-0) =
Asset Management Ratio
Fixed Asset Turnover
4,807/32,307 = 0.15
Total Asset Turnover
4,807/ 77,453 = 0.062
Days in accounts receivable
7,584/104,2...