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Walmart

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For the fourth year in a row, Wal-Mart is number one on Fortune magazine 's annual list. Holding the top spot on the Fortune 500 is a distinction that many companies strive to obtain. However, does size equal financial growth and stability? This paper will research Wal-Mart 's financial situation through analyzing its many different financial ratios.
Methodology
For the purpose of this research, all ratios, and pertaining data was retrieved from Mergent Online. The industry used for comparison was obtained by the North American Industry Classification System (NAICS), which replaced the U.S. Standard Industrial Classification (SIC). (http://www.census.gov/epcd/www/naics.html) This peer group reported by NAICS via Mergent includes …show more content…

Now in 2004, that $0.06 is superior to the industry average of nearly $0.02. This clearly explains Wal-Mart 's strong and consistent profitability over the past 5 years. However, it has taken aggressive business decisions, marketing, and efficient management of company assets to reach this point.
Asset Management The difference between great companies and average companies is their level of commitment to improving their processes. Wal-Mart is undoubtedly an extremely successful company. However, the commitment to improvement that got them to that spot will determine whether they stay there. Wal-Mart 's consistency in its profitability is something to look highly upon; however, is this consistency a sign of inefficient management of company assets? We will look to the following section for the answer. By comparing the revenue to the total assets, we will see the effectiveness of Wal-Mart 's management of its assets. See Figure 5, shown below. Figure 5 The revenue/total assets ratio, also known as Asset Turnover Ratio, shows effectiveness of assets on the company 's revenue. Over the period, Wal-Mart has maintained a return of approximately $2.50 per $1 of asset. This return is comparable to the industry average of $2.25. This means that Wal-Mart is more aggressive in its uses of assets than the industry. "A high ratio compared with other firms in the same industry could indicate

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