Panera Bread Ratios

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A crucial facet of the examination of strengths and weaknesses of a business is a financial analysis. Financial analysis is comprised of ratio analyses, trend analyses, and comparisons with other companies. Financial ratios can be categorized consistent with the data they deliver. Financial ratios are valuable gauges of a business's operation and fiscal condition. Most ratios can be computed from information delivered by the financial statements. The following categories of ratios are commonly used: Liquidity ratios, Financial Leverage ratios, Turnover ratios, Profitability ratios, and Market Value ratios. A full financial profile of Panera Bread and their key competitors can be found in Table 3. Liquidity Ratios Liquidity ratios deliver data about a …show more content…

The quick ratio is an alternate calculation of liquidity that does not take account of inventory in the current assets. The quick ratio is the ratio of current assets minus inventory then compared to current liabilities. The current assets used in the quick ratio are cash, accounts receivable, and notes receivable. It is a sign of a business’s short-range convertible assets. The greater the quick ratio the healthier the business's liquidity situation is. Panera Bread had a 0.86 quick ratio for the year ending December 2014 which was an increase over their 2013 fiscal year ratio of 0.69. This indicates that the company has $0.86 of liquid assets accessible to account for every $1 of current liabilities. This annual escalation was generated by a greater increase in Panera Bread’s assets over the year compared to its liabilities. The industry average for this sector is a quick ratio of 0.80. These figures illustrate that Panera Bread is executing superior to the rest of the industry. Panera Bread has firm financial power to reimburse its debts if

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