Jb Hi-Fi Report

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Executive Summary

The purpose of this report is to evaluate the findings of an analysis conducted on JB Hi-Fi (JBH). This evaluation will be assessed to present a recommendation to acquire shares to add to an investment portfolio. This report will assess JBH relative to profitability, asset efficiency, liquidity, capital structure a


JB Hi-Fi (JBH) Company Profile

Sector: Services
Industry: Specialty Retail, Other
Public Company: Share holders

A public ltd company sells theirs shares through the stock exchange.Companies can have a full quotation put on the stock exchange so their share prices appear on
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The company continued to grow through the recession of the 1990’s and has continued to do so since the onset of the global financial crisis. The performance of the company during these periods highlights the strength of its business model. (JBH Annual Report, 2009)

Asset Efficiency Analysis

2009 2008 2007
|Asset turnover ratio 3.517 3.412 2.827
|Days inventory 50.9 54.27 60.17
|Days receivables 2.67 2.73 3.89
|Days payable 42.97 39.3 52.76
|Times Inventory Turnover 5.6196 5.2556 4.7279

JBH’s ability to generate income per dollar from its assets has increased by 19.62% over the reviewed period, reflecting a positive improving result. JBH do not have a distribution warehouse, instead the company holds all stock, in store, displayed on the floor. This approach makes for a lean system, which eliminates over ordering. JBH’s
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