FINANCE ASSIGNMENT 2015 PANERA BREADS CO. (PNRA.O) QUESTION 1 Debt/Equity1 Year Date Debt Equity D/E Ratio 2014 28/12/2014 100,000 736,184 0.14 2013 28/12/2013 0 699,890 0 2012 28/12/2012 0 821,920 0 2011 28/12/2011 0 655,080 0 The Debt/Equity ratio is 0.14 at the end of Q4 in 2014. This increase on previous years was because of the company’s increased long-term debt, which consisted of the firm’s term loan agreement it entered into on June 11, 20142. Compared to its competitors like Starbucks and Chipotle whose Debt/Equity ratios are 0.353and 0.274, Panera Bread is in a good position. Preferred and Common Stocks Panera’s preferred stock for the 4th quarter of 2014 was $0 million. Largest proportion of its equity comes from common stock, …show more content…
This figure is as a result of the loan it acquired on June 11, which will fund the firm’s operations11, including a range of growth initiatives such as the rollout of Panera 2.09. The 5-year term loan applies a floating rate of interest based on a credit spread to LIBOR based on the company's consolidated leverage ratio12. The borrowing rate at the time of the loan was approximately 1.15%8. Certain of its direct and indirect subsidiaries14 guarantee PNRA’s commitments under the term loan. At the end of Q3 2014, PNRA had a cash balance of $146 million—compared to $125 million at the end of fiscal year 2013. Cash flows from operations totalled $194 million9. Cash equivalents totalled $146 million11. The large cash reserves and consistent revenue increases each year coupled with the relatively low amount of total debt indicate that the firm is strong financially. Where the Company Issues Shares Panera’s common stock is traded under the title “PNRA” on the NASDAQ Global Select Market. The firm reported Q4 2014 diluted EPS of $1.82 and fiscal year 2014 Diluted EPS of $6.6413. As of 19/03/2015, PNRA has an overall market cap of
In this case, we can say that Amazon performance is a lot better than CanGo. A high Debt to Equity Ratio generally means that a company has been aggressive in financing its growth with debt. Debt can come in the form of stocks, bonds, and loans that the company borrowed against. Amazon current ratio is 1.31, but CanGo current ratio is 5.33. In general we can see that CanGo is performing better in this area compared with their main competitor Amazon, because this ratio shows that CanGo is capable of repaying its debts and liabilities than
Their current ratio improved from 1.59 to 2.44 which shows the ability to cover current liabilities has improved. Massachusetts Stove Company strategically made decisions to not only increase their current assets quickly but also managed their liabilities to keep them from growing out of control. This means that the company could cover current liabilities at any time relatively easily with their cash, receivables, or other current assets. In terms of the market, Massachusetts Stove Company does have the demand of 220,000 active prospects they could try to sell stoves too if a dire need arose for quick cash. Management even brought their quick ratio to 1.08.
The first time I have heard of the Chick-fil-A Franchise Opportunity was in the discussion about good opportunities of starting business in the Facebook community. My interest in different business opportunities to bring a change to my life prompted me to check what Chick-fil-A Franchise could offer to a motivated individual committed to developing one’s own business and making it successful entrepreneurships experience. I have studied a list of the top-ranking global franchises, their profiles and the industries they operate in. The American Franchisee Association was also a helpful resource for learning more about franchise opportunities. Out of the one hundred companies and corporations listed, eight represent franchises that are
Competition exists in most industries, and it is considerably fierce in the restaurant business. This is especially true for the focus of this paper, Panera Bread, and the specific restaurant market it operates within, “Fast Casual”. According to the balance, Fast Casual offers the ease and convenience of fast food but with a more inviting sit-down atmosphere. As evidenced by Panera’s explosive growth since its inception, their execution has helped define the Fast-Casual concept.
This touches the core of the community. The CEO of Panera works with frontline employees to middle management to keep them aware of recognizing stakeholders. Making the right decisions on partners, and locations has been an effective strategy for his
Whenever I think of breakfast, I think of three things: scrambled eggs, bacon, and of course, bagels. Anytime I walk into a Panera Bread Company, I am overwhelmed with all of my choices. Should I pick chocolate chip? Or should I go with a plain bagel with blueberry cream cheese? Today, there are so many different combinations of bagels and all of the toppings and spreads that come with a deliciously crispy, toasted bagel.
Setting The observation was conducted at the Panera Bread restaurant located in River Forest, Illinois at around 5:00 P.M. on Thursday on the 15th of September. When I arrived at the restaurant, I chose a seat close to the door so as to better observe people coming up to the counter to order. I looked around and did not see any children, the restaurant was mostly populated with college aged people and a few elderly folks. Approximately a half hour later, I observed a white, brunette female with a short ponytail, in her mid-thirties enter the restaurant with a girl of approximately five years of age with a similar brunette ponytail in tow.
The company increased its long-term debt from 20 million to over 530 million from 2006 to 2011. This significantly increased its Debt to Equity Ratio from 0.18 to 1.17 over the previous fiver years. The increase in debt also hindered the company's current ratio and interest coverage ratio as time went on. As seen by the debt covenants and the decline in AP days, creditors began to feel uneasy about the amount of debt being taken on by the company. In a relatively short period of time a walnut distributor had taken the snack segment by storm and was poised to make a multi-billion dollar bid for Pringles.
They repurchased lots of their stock as well, 6,500,000 shares in 2015, 6,800,000 shares in 2014, and 6,700,000 shares in 2013. These were all valued at approximately 521,000,000 in 2015 and 400,000,000 in 2014 and 2013. They were also able to repay 500,000,000 in senior notes at maturity on January 15, 2016. In final, they expect to repurchase 650,000,000 to 700,000,000 dollars worth of common stock on December 31,
Introduction The main objective of this particular case study is to assist Victor Dubinski, the current CEO of Blaine Kitchenware, decide whether or not repurchasing shares and changing the firm’s capital structure in favor of more debt could actually be benefit the company and its shareholders. Blaine Kitchenware is a small cap, public company who focuses on selling various different residential kitchen appliances. Up until this point, the company has only used cash and equity financing to acquire independent kitchen appliance manufacturers, and expand into foreign markets abroad. Given their excess cash and lack of debt, Blaine Kitchenware is considered to be “over-liquid and under-leveraged” (Luehrman & Heilprin, 2009).
Their current ratio is 1.4% (total current assets/total current liabilities). According to the Risk Management Association of Financial Ratio Benchmarks, the current average ratio is 1.5%. In 2014, the current ratio for the firm was 1.46% while the average ratio in the industry (NAICS 311330) was 1.6%. The company’s net property and equipment in 2015 is worth 2.6 million dollars, a slight increase from 2014, which was 2.3 million. The company is considering taking on some debt to increase their production capabilities.
SNC was able to increase its total firm value by $1,834,000 and its total equity value by $1,581,000, in 2012 dollars. On average, this attributed to an increase of approximately $203,778 a year in firm value. After a complete analysis of the company, SNC has proven and established itself as a trustworthy company, and it is expected that the market will reward SNC with lower risk. From 2010-2021, the equity multiplier decreased about four times from an average of 3.65 to an average of 1.10. The risks associated with taking on debt are mitigated due to SNC’s decreased leverage.
Now, Cost of equity (Re) = 8.95% + 1.21×7.43% = 17.94% While determining the cost of debt we again used 8.95%,30 year U.S. Government Interest Rate given in Table B as the risk free rate plus 1.10% debt rate premium above Government rate, which is given in Table A. Cost of debt (Rd) = 8.95% + 1.10% =
Panera Bread: Ethical Competitive Analysis Panera Bread is presently a recognized as a leader in the fast-casual type of the restaurant industry. However, despite its status, Panera Bread should understand the potential new entrants in the industry by conducting a competitive analysis of the fast-casual sector. The company can conduct an ethical and appropriate analysis by studying major and successful players in the restaurant sector currently dealing in unrelated food products. These companies are probable entrants in the market since they may attempt to introduce new product channels to boost their profits.
Kraft Heinz Company the 5th largest food and beverage company with revenues over $26.5 billion and 26 popular brands under its umbrella has recently seen sales disintegrate from competitors that are associated with natural and organic brands (Kraft Heinz Company, 2017). This analysis studies Kraft Heinz Company’s strategy, competitive position in the market, problems being faced, and the company’s financials. KHC, an established company in the packaged-food industry, has dominated the market share with a 3.7% dividend yield, but can soon face destruction to their profitability and impose losses among competitors (KHC: Dividend Date & History for the Kraft Heinz Company, 2018). In order for KHC to remain an industry leader, they must first have a deep understanding of the pertinent factors surrounding the company’s situation (Thompson,