According to the BARRA risk analysis model, BUD`s value at risk (VaR) number is 1% for a monthly and 5% for a daily analysis. This number explains how risky a stock is comparing to the market index. Since both numbers are relatively small on a scale of 100, investing in BUD has a pretty low risk; however, it is riskier than investing in the market itself. As it was discussed before, the company`s beta of 1.14 is also a sign that it is more volatile than the market; yet, it is a pretty small difference. Moreover, Anheuser-Busch InBev is a large cap company with a 206 billion market cap.
Building a S.W.O.T in the business world can prevent closures. So what’s these two business doing to make sure they remain multi million dollar companies. Wal-Mart is the largest company and retailers in the world . Also it is the worlds largest employer holding more than 2.3 million employees. Walmart is a very powerful retail store, holding the reputation for cheaper prices, faster services all for one store.
Dupont Analysis enables us to answer this question. Kohl?s Corporation Dupont analysis is 12% consisting of 4% (profit margin) x 1.41 (total asset turnover) x 2.48 (financial leverage). Compared to J.C. Penney?s Dupont analysis of -39% consisting of -4% (profit margin) x 1.34 (total asset turnover) x 7.21 (financial leverage). Kohl?s Corporation is generating sales while maintaining a lower COGS as demonstrated by its higher profit margin, and turning over large amount of sales. Although J.C. Penney Corporation has a negative profit margin, the company is heavily using their financial leverage.
But the benefits provided was justified by the higher premium charged. Due to its effectiveness, the price increase did not hurt the customers as it was the most effective medicine in cold relief. Moreover, in order to curb the effect of inflation, I increased the price of the product during the periods. I also found that our price is close to tradeoff (exhibit 2) and thus the price can be increased. Since our bulk volume is being sold by wholesalers, it was decided to give major discounts to this category.
Wal-Mart has been one of the largest discount stores in the country in recent years surpassing all others with their discount prices and availability of multiple items and brands. In 2006, Wal-Mart Stores saw their performance fall to numbers never seen before since their beginning (Ferrell, Hirt, Ferrell, 2009). Increased competition from Kroger, Safeway, and Costco challenged Wal-Mart for the middle-income customers that they had long serviced. Top competitor, Target, emerged with a more appealing store presence and fashionable merchandise than that of Wal-Mart. When it came down to it, the difference in cost of similar items between both Target and Wal-Mart stores were only a few cents, not enough to make a difference for the consumer.
Costco, regardless of external pressures from other wholesalers such as BJ’s Wholesale and Sam’s Club has distinguished itself and experienced tremendous success as a result. In 2010, Costco brought in a net income of 1.3 billion whereas its competitor BJ’s Wholesale drew in only 132 million. The following year, Costco’s net income grew to 1.46 billion while BJ’s’ fell to 95 million. Ever since the mid-2000’s, Costco’s profit has steadily increased while it’s competitors have struggled to simply keep their profits from plummeting. Part of the reason Costco’s profits remain so high is because they outnumber their competitors in terms of store locations.
Debt Ratio: The ratio is what percent of your monthly gross income is required for paying bills. The measure provides attentiveness to the leverage of the company, along with the possible risks the company faces in the relations of its debt leverage that American Airlines is carrying on its books. Thus, using the formula total debt over total asset gives the result for 2015 .88 and for 2014 .95. A debt ratio of more than 1 indicates that a company has more debt than assets. Also, a debt ratio of less than 1 indicates that a company has more assets than debt.
In compare with the competitors, Amazon's Return on Equity was high in 2015 at 135% but drastically dropped throughout the years to 40% and 20% in 2013 and 2014 respectively. The main reason for the decrease was due to the yearly increase in the business's equity. As at 2008, Amazon's ROE is equivalent to the competitors and is expected to be in line with the competitors in the future. Meanwhile the ROA showed that Amazon is generating more income from its assets compared to its competitors. In comparison on the ROE and Return on Assets, Amazon has the highest growth among its competitors as it has a smaller capital base than EBay and a higher profit level than BN.
Tedra Colzie American Intercontinental University Unit 5 Individual Project Principles of Accounting I (ACCT205 -1502A -03) May 18, 2015 Abstract This paper will give an accounting analysis of Walmart. This paper will cover Discuss methods used to account for assets, liabilities, and shareholder equity. It will also explain the company’s approach to internal controls, prepare and interpret the results of horizontal and vertical analyses of the financial statements and prepare and interpret the results of at least 5 ratios. Walmart Introduction Walmart is one of the worlds largest supercenter with over 3,275 store nation wide. “Walmart helps people around the world save money and live better -- anytime and anywhere -- in retail stores,
(Exhibit I) Costco Wholesale Corporation- It is an US membership-only warehouse club that provides a wide selection of merchandise. It is currently the largest membership-only warehouse club in US. From the reports of 2014 Costco was the third largest retailer in US and by 2015 reports it was second largest in world the first was Walmart. The company has ranked at the top in retail industry in the American Customer Satisfaction Index in all the years since 2001, and it continuously beats Wal-Mart(Exhibit II). For 2015 Costco has scored in customer satisfaction 81, which is higher than the score 76 in customer satisfaction received by Wal-Mart's warehouse retail division Sam's