Summary Of Cheesecake Factory Financial Ratios
Financial Ratio Analysis
Liquidity
Current Ratio and Acid Test Ratio
Cracker Barrel’s average current ratio is .98 and average acid test ratio is .55. These averages are below the average in comparison to the Cheesecake Factory average current ratio is 2.5 and average acid test ratio is 2.2. Therefore, Cracker Barrel has enough current assets to cover their liquidity ratio, so they are providing themselves an excellent financial stability. Above all, the current ratio and acid test ratio includes immediate access to convert to cash. On the other hand, Cheesecake Factory has a financially stronger company with a greater amount of current ratio to cover their liabilities.
Working Capital
The working capital is the money
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The lower debt to equity ratio usually indicates a more financially stable business. Cracker Barrel’s three-year average total debt to equity was 1.84, in comparison to Cheesecake Factory three-year average total debt to equity was .83. Cracker Barrel’s debt equity ratio shows reliable debt they are running with compared to Cheesecake Factory they are running with .83 debts to equity ratio. Demonstrating Cracker Barrel with a higher average debt to equity ratio meaning its running mostly on finance assets.
Return on Investment
Return on Assets
Return on Assets is when a company makes itself profitable in relation to its total assets giving an idea of how Cracker Barrel in this case is using assets to produce revenue. For instance, Cracker Barrel return on assets is 10.4% on 2014 unlike, the Cheesecake Factory return on assets is 8.61%. Therefore, Cracker Barrel has a stronger efficient management to make revenue than Cheesecake Factory generating less of total assets which is good.
Asset Utilization
Inventory Turnover Ratio
The inventory turnover ratio is how fast a firm inventory is being sold or
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