Management has already established their track record of achieving these goals and it would not come as surprise if they could easily meet these targets. Valuation Based on the price earnings ratio, it appears that PLKI is relatively expensive over its peers. However, PLKI commands better returns since equity levels would be lower since the company is asset-light based on its “franchise” model. Further, its valuation is somewhat similar to Mcdonald’s Inc. since both companies have similar business model. At these valuation levels, the market is discounting that PLKI will post double-digit net profitability in the coming fiscal years.
Return on Equity increased from 10.98% to 15.39%, showing that the firm is more profitable than before. Earnings per Share increased as well, as there were less shares outstanding with the repurchase while net income was unaffected. EPS increased from $0.91 to $1.04, another indicator that the leverage increased profitability. With the repurchase, Blaine’s D/E ratio increased, going from not having any debt at all to a D/E ratio of 11.48%, which is more inline with industry competitors. PE ratio fell as a result of the leverage.
Cost reductions across the board are a tailwind for Exxon Exxon has aggressively reduced costs across the board. So far this year, Exxon has achieved a net reduction of $8 billion in capital and cash operating costs. Additionally, the company has also reduced its 2015 capex as compared to last year by $4.5 billion. Apart from this, it has also achieved a 10% reduction in unit costs in its upstream business on a year-over-year basis. As seen in the following chart, Exxon has recorded impressive cost savings in different areas of its business, which is a good
For example, reducing balance method shows a new car will lost it value quickly. So, this method is better match depreciation expense with an actual decline in the fair market value.Besides that, the other advantage is it matches the cost and revenue of the business. In other words, if there is a greater amount of depreciation provided during the initial years, it is matches against the higher amount of revenue generated by the increased production because of the use of new asset.The reducing balance method will charge big amount of depreciation in earlier
Chipotle’s financial performance in 2015 was better than 2014, even though the impact of the food safety incidents has led to a great decline in same-store sales in the fourth quarter. Overall, Chipotle has a good performance in 2015 with an increase in revenue and net income. According to the comparative analysis, COGS has increased 30.1% in 2015. One reason that the cost has increased is because the volatility of raw ingredients. Chipotle’s food costs were greatly increased due to instability of suppliers and rising food costs in the industry.
Return on asset % decreased in 2014 from 2013 and increased by very less margin i.e. 0.02% in 2015. Return on equity % decreased in the year 2014 and again increased in 2015 . 3)As an investor having made the analysis of financial position of both the companies, which company would you invest in when it comes to portfolios. According to financials, Citigroup is the third-largest U.S. bank by assets, reporting a 4 percent jump in the first quarter profit advanced 4.2 percent to $47.62 that beat analysts' expectation which helped by lower loan loss reserves.
By adopting a global expansion strategy, SNC was able continue to grow its revenues without tying too much cash up in inventory. Although, the FCF at the beginning of this phase was negative, it was made up over the remainder of phase 3. This phase resulted in an additional value creation of $715,000, but also resulted in a cash surplus of $740,000 at the end of 2021. This may be seen as a failure to invest by some investors, but it also provides SNC with extra cash to pay its liabilities or invest more in a future project. SNC could also use its additional funds to pay a dividend to its shareholders, which has not previously been done before.
For instance, the company has reduced its all-in-sustaining costs by over 21% to $848 per ounce from $1,067 per ounce last year. Also, its all-in costs have dropped by more than 40% to $949 per ounce from $1,577 per ounce in the third quarter of 2014. Goldcorp was able to achieve these strong results due to its operating for excellence initiative. The company has achieved benefits of about $250 million through this program in the first nine months of the year. As a part of this initiative, Goldcorp is undertaking steps to increase recovery rates, improve grades, and implement steps to reduce costs as we will shortly
SECTION 7 – GROWTH RATES Item Current Year Previous Year Growth Rate Sales 98.61 % 98.38 % .2 % Net Income 1.86 % 13.44 % -86 % Total Assets 48,455 26,353 83.8 % Total Liabilities 42112 21041 100 % Total Equity 6342 5312 19.39 % Comments on growth rates: Sales has increased from last year by 0.2 %, Net income decreased from last year by 86 %. This might be a warning sign for the business. VRX Assets have almost doubled from previous year. Total liabilities are the liabilities that the company has to pay others. It is a part of the balance sheet of a company that shareholders do not own, and would be obligated to pay back if the company liquidated.
A4.- Pricing Strategy The initial cost strategy to be used will be one of penetration based pricing. Since it is expected to attract a younger audience, it is understood that they have less income, so by offering the product at a lower cost than the competition will help us penetrate the market and achieve significant sales during the first months that the products they go to the market. If this campaign is successful as predicted, it will be observed that production costs will decrease, and we will also have a high inventory turnover. The cost of our products is as follows. Bag for drumsticks $15.00, and Protective rug for drums and percussion, $19.99.
Cabela’s accounts payable has seen relatively similar increases and decreases as its accounts payable. They experienced a huge decrease in AP % Change/ Overall % Change in Sales from 2006-2007. This could be in large part to the recession taking place, causing the company to carry less inventory, thus less accounts payables. Regarding their AP turnover ratio, it has fluctuated continuously over the period, ranging from 1-2.5. Cabela’s DPO ratio has increased throughout the 10 year period.
Because Lowes has a very high inventory level, the quick ratio is pretty useless. Their current ratio is good for the industry, but behind the market. These statistics show that Lowes is in a strong financial position. As far as efficiency is concerned, Lowes productivity from net income and revenue is less than the market but higher than their industry. This shows they still have a bit of room for improvement in their productivity to match the market.
Return on equity measures the overall profitability of the financial institution per dollar of equity. Generally shareholders of financial institutions prefer the high ROE. But, higher ROE means an increase in risk. 2014 2013 2012 2011 2010 Wells Fargo 13.01 13.35 12.66 11.90 10.38 Bank of America 2.03 4.87 1.79 0.63 (0.97) Analysis: The return on equity has been improved of the Wells Fargo & Co. from 2010 to 2014 whereas the ROE of Bank of America also increased till 2013 but decreased in 2014. In comparison of ROE the Wells Fargo‘s performance is better than Bank of America
It is also more stable during industry slowdown or recessions. In addition, according to Business Insider (Ashley, 2014), Costco’s revenue percentage change is 127.8% which is significantly higher than Walmart (70.24%) and Target (60.94%)