Essay on Lamar Swimwear

Macy’s Inc. ratio was .02 and JC Penny Co. Inc. was .00. To improve this ratio, both companies need to improve on their net income. If JC Penny doesn’t continue to improve its net income, then this ratio will begin to lean negative, signaling the company is losing money for every dollar is sales and may not be good investment. Macy’s Inc. still has room before it hits .00, however, if their net income continues to fall, they soon too may have the same profit margin ratio as JC Penny Co. Inc. Shutting down unsatisfactory stores – as each company is doing – may help improve this ratio as well. With less funding going to these stores, such as salary’s, rent, and wasted inventory, they will be able to improve their net income value.

The purpose of this paper is to advise analyze the financial statements of Dillard’s, Inc. in order to recommend whether or not my client should invest $1 million in the large retail company. I will compare the financial statements of Dillard’s, Inc. its competitor, Kohl’s Corporation. Investing in retail can be risky because a retail company’s performance is very heavily influenced by factors that have nothing to do with the actual company such as the overall performance of the economy or the weather during the holiday shopping season. There is, however, potential for profitability within the retail sector. Based on my analysis, I recommend that the client should not invest in Dillard’s, Inc. for the following reasons. First, Dillard’s has experience a decline in net income in the last three years. Second, liquidity ratios indicate that they could face possible liquidity constraints in the future. Third, long-term debt paying ability ratios indicate that the company could have trouble paying off the principal of its current debt obligations. Fourth, the profitability ratios are well below industry averages, suggesting that there are more profitable companies to invest in within the industry. And finally, Investor analysis ratios provide mixed opinion of the future performance of the company. I conclude that retail can be a profitable industry to invest in if an investor has the risk tolerance and risk capacity to withstand the uncertainty, but neither Dillard’s

Home Depot and Lowe’s have similar business models. However, Home Depot seems to be growing faster than Lowe’s. In addition, Home Depot achieves higher returns on the capital invested by their shareholders. Not only does Home Depot have a higher ROE, but they also achieved a higher ROA and as a result Home Depot has a higher ROFL, caused by its higher use of liabilities as a source of financing. Home Depot has a higher PM with 8% compared with Lowe’s at 6%. Lowe’s and Home Depot both came in at around 34% with gross profit margin. Home Depot achieves a higher turnover of total assets. A closer analysis of turnover ratio reveals that ART is extremely high for Home Depot indicating that accounts receivables are being collected more quickly, while

The Return on Assets ratio is a basic measure of the efficiency with which TCI allocates and manages its resources (assets) to generate earnings. With a 20% projected increase in sales, for 1996, we calculated TCI’s ROA to be 12.95%, and 12.11% for 1997. Although this isn’t an extremely high ROA, TCI will be allocating its resources very wisely with the expansion of its central warehouse. If MidBank lends them the cash they need to complete this project, their central warehouse will be able to hold more tires for their increasing sales, which will then convert into profit. A true test of TCI’s ROA will be after 1998, when the warehouse is complete, so you can see just how well they can convert an investment into profit.

In the Table __ and Fig __, you can see how the company has been performing. The overall profitability of the company has increased. Profitability ratios have increased since 2010. In particular, Harvey Norman’s Gross Profit Margin saw a significant growth, it grew 44.7% since 2010. Operating Profit Margin saw a similar result, finishing with a ratio of 10.5 in Financial Year 2015. Harvey Norman’s Net Profit Margin (when positive), have been at best maximum and are further illustrative of the paper-thin margins typically associated with the retail sector. Investments of Return on Assets (ROA) and Return on Equity (ROE) were also substantial, comparing 2010 and 2015 there was a relative decrease in ROA and ROE which doesn’t make much of a difference if the Gross Profit Margin has a strong game. Thus, on the basis of the financial results over the last 6 years, shareholders would definitely be confident about investing in Harvey Norman, unless there is a decline in current asset and equity returns.

With the exception of ROE, most financial ratios and even absolute values bear testimony to Wal-Mart’s recognition as the leader in the retailing industry. The reason behind Sears’s higher ROE can be explained by a comparison of the 3 ratios that constitute the ratio known as DuPont identity that is profit margin, asset turnover and equity multiplier. While both firms had similar profit margins, Wal-Mart’s asset turnover was 2.8 compared to Sears’ 1.1 due to the firm’s effective utilization of assets and lease agreements to facilitate revenue generation.

Return on assets ratio declined in 2010. This is due to increased total assets in 2010 due to company's acquisition of assets. In 2011, the company had a higher return on equity, which indicates that Lowe’s was able to generate more profit from the money that shareholder invested. The sales generated relative to total assets decreased in 2010, mainly due to reduced sales in 2009 coupled with increased total assets. Fixed asset turnover has been relatively good for Lowes. The ratio indicates how well the company is able to put fixed assets to use in generating sales. Current ratio has improved over past three years indicating a strong trend for the company in its ability to pay its current liabilities with current assets. The long-term debt forms a major part of company's financing. The company reviews its

The company’s debt ratios are 54.5% in 1988, 58.69% in 1989, 62.7% in 1990, and 67.37% in 1991. What this means is that the company is increasing its financial risk by taking on more leverage. The company has been taking an extensive amount of purchasing over the past couple of years, which could be the reason as to why net income has not grown much beyond several thousands of dollars. One could argue that the company is trying to expand its inventory to help accumulate future sales. But another problem is that the company’s

Also, according to its leverage ratios, the company’s debts are not only very high, but are also increasing. Its decreasing TIE ratio indicates that its capability to pay interests is decreasing. The company’s efficiency ratios indicate that despite the fact that its fixed assets are increasingly being utilized to generate sales during the years 1990-1991 as indicated by its increasing fixed asset turnover ratio, the decreasing total assets turnover indicate that overall the company’s total assets are not efficiently being put to use. Thus, as a whole its asset management is becoming less efficient. Last but not the least, based on its profitability ratios, the company’s ability to make profit is decreasing.

Faced with the adverse economic environment, the sports retail industry is fiercely competitive. All the companies involved take various measures to maintain competitive advantage and improve profitability. When it comes to whether a corporation is worth to invest, financial analysis is greatly needed, since it can provide sufficient information to investors from different viewpoints. After in-depth financial analysis of JD Sports Fashion (JD), one of the leading specialised sports retailers in UK, it can be concluded that JD is worthwhile for a pension fund to invest.

During this period, the Return on Assets increased from 5.7% in 2012 to 34.6% in 2013. This implies the number of cents earned on each dollar of assets increased from 2012 to 2013. This shows that the business has become more profitable. Equally, the Return on Equity also increased from 12.0% in 2012 to 46.5% in 2013. This similarly implies that the company in 2013 was more efficient in generating income from new investment. This, also can be attributed to the sale of the Digital Business Brand which enabled the company appraise its strategic plan.

The purpose of this report is to perform a comparative analysis of the profitability of two potential equity investments: Auto Wash Bot Ltd. (AWBL) and Popeye’s Muscle Wash Ltd. (PMWL). AWBL is selling 50% ownership for $100,000 in efforts to pursue expansion in the mobile device industry, and PMWL is selling 100% of its business for $100,000 to pursue retirement. A complete analysis of each company’s income statement will report key issues in both firms, as well as offer a

This paper will seek to analyze the financial statements of the O.M Scott & Sons Company during the years 1957-1961, in order to provide readers with a thorough understanding of the various factors that may influence the future success of this business. Additionally, recommendations based on an analysis of their financial

But Dupont analysis indicates that profitability and efficiency have become lower. Additionally, the working capital has become lower and the current and quick ratios have declined. To understand the impact of these declining ratios on this company, the industry trend has to be analyzed to see if this happening throughout

- The financial statements for the past three years show a decline trend in both the operation and return on shareholder of the company, so a closer look at the factors contributing to this decline is needed.