Introduction You would not buy a home, car or other large purchases without researching what product offered you the most for your money. The same is true when investing in a company. Investors do avid research on multiple companies to find what company matches the investors' criteria. In this paper Team C will research both AT&T and Verizon's financial documents. Team C will compare selected ratios, cash flow and make recommendations how both companies can manage cash flow for the future. Financial Ratio Analysis Ratio analysis are useful tools when judging the performance of a company by weighing and evaluating the operating performance (Block-Hirt). There are 13 significant ratios that can separate by four main categories, profitability, asset utilization, liquidity and debt utilization ratios. The ratio analysis covered here consists of eight various ratios with at least one from each of these main categories. These ratios were used to compare and contrast the performance of Verizon versus AT& T over the years 2005 and 2006. This section will discuss ratio analysis for the following ratios: current ratio, quick (acid-test) ratio, average collection period, debt to assets ratio, debt to equity ratio, interest coverage ratio, net profit margin, and price to earnings ratio. Depending on the end user which ratio carries more importance, however, all must be familiar with ratio analysis. Details on each company's performance for each of these areas can be found in the attached ratio analysis worksheet. The first analysis will be on Verizon. The current ratio and the debt to equity ratio both improved in 2006 when compared to 2005. However, the net profit margin dropped from 9.8% to 7.0%. What does this tell us as investors... ... middle of paper ... ... organization's management. The ratios were broken down into classifications of liquidity and asset utilization, debt and interest coverage, profitability and market-based ratios. References: Block, S. & Hirt, G. (2005) Foundations of Financial Management 11th Edition. McGraw-Hill Irwin. Retrieved April 25, 2007 from http://finance.yahoo.com/ Retrieve from http://hoovers.com/verizon/--ID__10197,period__A--/free-co-fin-balance.xhtml Retrieve from http://hoovers.com/verizon/--ID__10197,period__A--/free-co-fin-income.xhtml Retrieve from http://hoovers.com/at&t/--ID__11379,period__A--/free-co-fin-income.xhtml Retrieve from http://hoovers.com/at&t/--ID__11379,period__A--/free-co-fin-balance.xhtml Retrieve from http://finance.aol.com/quotes/verizon-communications-inc/vz/nys Retrieve from http://finance.aol.com/quotes/atandt-inc/t/nys?tabs=quotesandnews
Phone companies are in a constant battle about which one has the best service. What would you say is the best phone company? AT&T and Verizon have been known to be one of the best companies, which means they are constantly competing against each other for customers. The two ads I found are from each companies perspective to show how both think they are the better carrier. I argue that Verizon is the better company between the two because of background knowledge and research that has been done.
Imagine if nobody had a cellphone in today’s world. That’s why today everybody has some form of a cellphone contract with the four major companies (AT&T, Sprint, Verizon or T-Mobile) or a less know cellphone provider. AT&T and Verizon Wireless provide more than the other two major companies.
The first method we will review is the accounting method. Through this accounting approach we will analyze specific ratios and their possible impact on the company's performance. The specific ratios we will review include the return on total assets, return on equity, gross profit margin, earnings per share, price earnings ratio, debt to assets, debt to equity, accounts receivable turnover, total asset turnover, fixed asset turnover, and average collection period. I will explain each ratio in greater detail, and why I have included it in this analysis, when I give the results of each specific ratio calculation.
Our family’s cell phone has increased tremendously over the past two years. Verizon is continuing to raise our bill while offering new customers lower rates. Our family of six is consistently paying $350 a month for our cell phone bill. This equates to $4,200 per year spent on cell phone coverage. My family has been a loyal Verizon customer for over 15 years. We believe that we should be getting the same rates as people who join the network today get. Below I have put our bill for August 2016 which was a total of $356.89.
The main contributing factor to the decline in the return on stockholders’ equity (25.37% to 8.73%) was the decline in the profit margin (11.79% vs. 5.08%). The decrease in asset turnover (1.11 to 1.00) made a small contribution to the decline, as did the decline in the debt ratio (48.4% to 41.8%).
Employee motivation is one of the keys to success in any business, especially in a retail sales environment. It is particularly important to understand how employee motivation can be impacted by the strengths and weaknesses of AT&T’s retail sales consultant position (RSC). A series of interviews and surveys were conducted over a two-week period with employees of AT&T in the RSC position as well as retail management positions to determine how the employees really feel about this position as well as internal strengths and weaknesses that contribute to employee motivation. Although there are a lot of positive factors that keep the employees motivated within AT&T, there are some weaknesses that can cause employees to become demotivated.
In regards to the corporation’s balance sheet, it is necessary to place an importance on liquidity ratios to demonstrate the company’s ability to pay its short term obligations such as accounts payable and notes that have a duration of less than one year. These commonly used liquidity ratios include the current ratio, quick ratio, and cash ratio. All three ratios are used to measure the liquidity of a company or business. The current ratio is used to indicate a business’s ability to meet maturing obligations. The quick ratio is used to indicate the company’s ability to pay off debt. Finally the cash ratio is used to measure the amount of capital as well short term counterparts a business has over its current liabilities.
The soft factors can make or break a successful change process, since new structures and strategies are difficult to build upon inappropriate cultures and values. These problems often come up in the dissatisfying results of spectacular mega-mergers. The lack of success and synergies in such mergers is often based in a clash of completely different cultures, values, and styles, which make it difficult to establish effective common systems and structuresBased on the case study, extensive research and annual reports of AT&T the writer has mapped AT&T in the different domains. AT&T should strive to attain a perfect circle as close to the centre as possible, which indicates total synergy, order and equilibrium. Where the circle is skewed drastic change is needed as it moves closer to the outer ring of chaos:
Ratios analysis also makes possible comparison of the performance of different divisions of the firm. The ratios are helpful in deciding about their efficiency or otherwise in the past and likely performance in the future.
The company I chose to do my annual report analysis on is AT&T, is a telecommunication company, it is the second largest telecommunications company and the largest landline provider in the United States. AT&T is also the 23rd largest telecommunication provider in the world. Verizon is the largest wireless provider and the second largest telecommunication company in the United States, after AT&T respectively. I will provide stock information on Verizon, to compare two company in the same competing field. AT&T's 52 week high was 37.12 and the low was 30.97, Verizon high was 51.20 and the low was 38.06, this show that stocks went down, for both companies.
investors and lenders. There are various financial terms which help in providing financial information of an organization. By looking at the raw data merely it is difficult to make any judgement from the income statement and balance sheet. “Ratio analysis is a form of financial statement analysis that is used to get a quick sign of a firm’s financial performance in several key areas. Ratio analysis is a cornerstone of fundamental analysis. Ratio analysis provides information about company’s financial information, whether it is in loss or profit.
I have leant that ratio analysis offers better insight of a company’s financial position on the short-term and long-term basis. However, I would recommend that investor advice should be based on ratio analysis that considers ratios from several years. This will ensure that the investor is making an informed decision based on the company’s financial ratio performance trend.
Ratios traditionally measure the most important factors such as liquidity, solvency and profitability, as well as other measures of solvency. Different studies have found various ratios to be the most efficient indicators of solvency. Studies of ratio analysis began in the 1930’s, with several studies of the concluding that firms with the potential to file bankruptcy all exhibited different ratios than those companies that were financially sound.
Organizations use financial statements and ratio analysis assess financial performance viability. The ratio analysis are used to identify trends and to perform organizational comparison (financial) with other companies within same industry. Ratio analysis, using data reported on the financial statements, are divided into five major categories: common size, liquidity, solvency, efficiency, and profitability. This paper will assess the financial stability of John Hopkins Hospital (JHH) using the five ratio analysis.
Any successful business owner or investor is constantly evaluating the performance of the companies they are involved with, comparing historical figures with its industry competitors, and even with successful businesses from other industries. To complete a thorough examination of any company's effectiveness, however, more needs to be looked at than the easily attainable numbers like sales, profits, and total assets. Luckily, there are many well-tested ratios out there that make the task a bit less daunting. Financial ratio analysis helps identify and quantify a company's strengths and weaknesses, evaluate its financial position, and shows potential risks. As with any other form of analysis, financial ratios aren't definitive and their results shouldn't be viewed as the only possibilities. However, when used in conjuncture with various other business evaluation processes, financial ratios are invaluable. By examining Ford Motor Company's financial ratios, along with a few other company factors, this report will give a clear picture of how the company is doing now and should do in the future.