Risk profile comparison with key competitors

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A leading Global food beverage company has identified five broad key sources of risk influencing its overall operations. They include: input risks, product market risks, operational risks, financial risks, and legal/regulatory risks. Table (1) compares the company's risk profile (represented by selected variables) with those of two close competitors. Provide three examples of specific risks associated with each category and discuss strategies (techniques) to manage them.

Table (1): Risk Profile Comparison with Key Competitors

 

Food/Beverage

Competitor I

Competitor II

Market Capitalization

$148.2B

$201.0B

$16.8B

Beta

0.52

0.48

0.28

Debt/Equity

2.46

1.11

1.32

Revenue (2015)

$63.1B

$44.3B

$6.3B

Net Income

$5.5B

$7.4B

$0.8B

Gross Margin

55.0%

60.5%

59.3%

Operating Margin

13.3%

19.7%

20.7%

ROA

7.8%

8.1%

8.9%

ROE

37.2%

26.3%

36.5%

Reference no: EM131482992

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