Introduction WH Smith publicly limited company (plc) is one of based British retailer which experience in Travel and High Street. Its operates a chain of retail shops selling books, magazines, newspaper and some small range of entertainment products for people in high street, railway station, airport, motorway service station and hospital. It has seen the chain is effectively spread UK-wide in recent years. This report is going to analysis and evaluation some of issues about investment for WHSmith plc. In the following paragraphs, it also will explain basically how the stock market in specific in relation to plc and also investor. Then for analysing the company’s financial performance use the data from ratio analysis. The data will compare …show more content…
Price/Earnings ratio (P/E) = Market price / EPS=4.99/0.37=13.31X Dividend yield (DY) = Dividend paid/Market price per share = (22.50 / 100) / 4.99 = 4.51% Dividend cover (DC) = Profit after tax/Dividend=52.20/22.50=2.32X EPS serves as a measure of how much of a company 's net income can be allocated to each share of stock. Stock traders watch changes in EPS closely and respond quickly. If a stock 's EPS is significantly higher than its stock price it can be considered a solid investment, since it is likely that the stock 's value will increase in the future. As mentioned above, a market price lower than EPS can generally be expected to rise, and the opposite holds true as well. Thus, a P/E under 1 indicates growth opportunity, while a P/E over 1 indicates an inflated price likely to drop. Business context …show more content…
2014 Market Cap Net Income P/E Dividend 5-Yr Rev Med Oper. Interest $Mil $Mil Times Yield% CAGR% Margin% Coverage Industry Average 1,270 18 — — 6.8 1.7 41.1 WH Smith PLC (GBP) 1,293 91 14.7 2.9 -2.6 7.8 — Dixons Carphone PLC 4,344 48 44.4 1.6 248.7 6 4.9 Sports Direct International PLC 3,770 180 21.6 — 14.6 8.9 30.5 ASOS PLC 1,757 36 47.4 — — 7.1 805 JD Sports Fashion PLC 827 47 17.3 1.6 14.7 5.4 37.2 Source by: WHSmith plc (SMWH) industry peers (extract), MORNINGSTAR Conclusion On one hand, ABC had good performance in make revenue. On the other hand. Significant decrease in profit. This because of the new borrowing bank loan, that the interest of the loan reduced the profit. Overall this research in the business and financial performance of WHSmith plc, this report figure out their performance and position is improving every year. The company is doing very well to achieve its corporate objectives and that’s what is giving them more sales in every year and hence the company is becoming more profitable. If look at the ratio analysis in the above section, can easily see that the companies most of the ratios are improving and they are getting ever stronger than before in both financial terms and as a
This, in turn, also improved the cash conversion cycle from 72.1 days to 57.1 days. The EBITDA margin decreased, however, this decrease would have been more if the underperforming stores were still operating. Source: Televisory’s Research Source: Televisory’s Research. Source: Televisory’s Research. Source: Televisory’s Research.
The first financial ratio of the analysis is the Price to Earnings ratio (“P/E ratio”). The ratio is computed by dividing the price of one share of common stock, by the earnings per share of common stock. This analysis uses diluted earnings per share which assumes the issuance of new stock for all existing stock options. Also, the price of the stock was computed as an average of the fourth quarter high and low stock prices published in the 10K report of each company, because the year end stock prices were not listed for all the companies. Because the P/E ratio measures the relative costliness of different stocks, in relation to their income, it provides a useful place to begin the analysis.
The fourth ratio we will analyze is earnings per share. Earnings per share (EPS) are the number of dollars earned during the period on behalf of each outstanding share of common stock.
3. Analyzing the financial results in Exhibits 1 and 4, give an assessment of how well the company is executing its strategy. How has the company’s stock price performed over the past four
Wm Morrison Supermarkets Plc was founded by William Morrison in 1899 in United Kingdom and also the fourth largest food retailer with more than 400 convenience stores from Bradford market stall. Their business is mainly on fresh food, fresh fruits and grocery with their unique technology procurement and quality. Nine million customers would pass through the stores to shop for their foods and grocery and 132,000 employees of Morrison would deliver great services to them such as ordered online they wants and delivered to their residential. Morrison helped consumers to save money every day by having some competitive prices and hundreds of special offers.
This project displays the evaluation of the financial performance of a publicly traded US Corporation, based on the information that is found. It will include some of the most important financial statistics that that company has on their most recent 10k reports. Once all the financial information of that company has been collected, a conclusion will be drawn based on the finding as well as comparing those stats to the stats of their leading competitors.
The report will give an overview of each company, an explanation of what type of companies we are analyzing, the purpose of each company in terms of its goals and objectives, the products and services each company produces, and what future prospects we see these companies having. The reader should gain an understanding of each company as well. We also analyze the type of industry these companies are competing in. This will help us understand where each company fits in the marketplace. This is important because it places the two companies into a broader picture. The most important part of the financial report is the financial statement analysis. In this, the annual report of each company was analyzed. It studies the firms’ past earnings to understand their operating performances. It also forecasts future profitability and risk (short-term and long term). The financial statements give information on how these risks affect expected return. In the end, the reader will have an understanding of the two companies, the industry in which they operate, its financial standing in the past and present, and future profitability.
Introduction The purpose of this report is to undertake financial analysis of the position of the three major supermarket chains (Tesco plc, Morrison plc and Sainsbury plc) in the UK, using the financial tools such as Horizontal and Vertical Analysis and Ratio Analysis. The calculations done are considering the figures from the income statement and balance sheet of these three companies for the last 2 years (2008 & 2007). Doing these calculations is an effort to find out the current position and if any forecast on their performance. Tesco Plc *Interpreting the Horizontal and Vertical *Analysis The balance sheet’s horizontal analysis reveals the first worrying statistics about the company- the fact that stock level has increased by 25.84% in the year, even though net assets have increased by only 12.59%. The vertical analysis of the balance sheet again highlights the increase in amount of stock held by the company at the end of 2008 and increase in current assets. Interpreting the Ratio Analysis By looking at the ROCE* ratio it is clear that the business has not generated any higher return in the period 2007-2008. Though there is a marginal decrease in the returns (0.14% from 0.16%), however when compared with returns of other competitors Tesco plc has performed much better. Drop in asset utilisation ratio in the year 2008 indicates that the company did not use its assets efficiently to generate sales. As a result profit margin dropped down to 5.91% in 2008 from 6.21% in the year 2007. The Acid test ratio also doesn’t meet the ‘ideal’ ratio of 1:1. In other words Tesco had only 38p of quickly realisable assets to meet each £1 of current liabilities. Stock turn shows the effect of increased stock at the end of 2008 as it s...
...ccurately reflects the intrinsic value of the company from the shareholders point of view and their expectations of future earnings.
In the Market Performance chart, it is broken into two categories which are Earnings per Share and Price Earnings Ratio. As with any market it is important to understand and gauge key performance indicators and evaluate these goals as it establishes the execution for the future. In the Market performance chart EPS; it measures the firm’s performance, and provides to the shareholder an amount of earnings available. Both Google Inc. (GOOG) and Yahoo! Inc. (YHOO) since 2008 continue to increase in a 5 year review as GOOG in 2012 established an 85% increase while YHOO merged to a staggering 1080%.
Looking at the financial reports of a company for the first time can be overwhelming if not intimidating. Analyzing the financial reports to determine the health of a company is much that same but different aspect must be looked at properly in order to predict and assess the health and wellness of a company. The different aspect in assessing the health of a company include the depreciation analysis, stock analysis, cash flow statement analysis, income statement trend analysis, management analysis, significant changes and possible reasons for the changes and implications of change.
The following analysis will help to determine whether or not Dixons Retail plc’s performance within the industry is good. It will also show if the company’s financial position is stable in comparison to other business within the same market. The analysis is broken down in several bullet points containing information about relevant financial ratios that are useful to understand the business performance.
Investors in the stock market judge earnings growth against two figures: the average industry earnings and the estimated earnings for the company. If analysts predict earnings to be above the industry average, a company’s stock price will usually rise. If companies report earnings higher than predicted, stock price will typically rise even more.
A financial statement analysis aids in understanding the financial health of a company. By utilizing this evaluative method, investors, shareholders, managers and other affiliated parties are able to determine past, present, and projected performance of a company. Various techniques are used within this evaluative method including horizontal and ratio analysis. These techniques will show a comparison between two or more years of financial data as well as the statistical relationship between the financial data. It is the researcher’s intent to perform a financial statement analysis on Coca Cola Enterprises to demonstrate its potential healthy financial trends to future investors.
For our Sample Co. there are several ratios that are low, for the average manufacturing company. The ROI and ROE are below average as are the current ratio and the acid-test ratio. The P/E ratio is $42 / $3.51 = 12, which seems very good and both the debt ratio and debt to equity ratio are within the guideline. With the good and bad of these ratios hard to tell what sort of industry this is. With the ROI, ROE, and acid-test low like they are it doesn't seem like a retailer/merchandising company, and a e-commerce for 2000 would probably have a P/E greater than 12. What that leaves is an international service company of some kind, so I'll go with that.