Standard ratio analysis-compound growth rates, Finance Basics

Assignment Help:

Standard ratio analysis should be used to supplement the discussion of strength and weakness.

The following ratios are most often used by practitioners:

(a) Growth Rates: PEG Ratio and 10 year or 5 year compound growth rates (CAGR) in Sales and EPS of the two companies prior to the merger.

(b) Liquidity Ratios

(c) Leverage Ratios:

(i) Book Value of Total Debt/Book Value of Equity

(ii) Book Value of Long-term Debt/Book Equity

(iii) Book Value of Total Debt/Market Value of Equity

(iv) Interest and other fixed charge Coverage Ratio

(d) Operating Characteristics:

(i) Total Asset Turnover

(ii) Average Collection Period

(iii) Gross Profit Margin

(iv) ROE and ROA

(e) Investment Characteristics:

(i) Capital Expenditure as a percentage of Total Asset

(ii) R&D as a percentage of Total Assets

Most of these ratios are available from Bloomberg, Standard and Poor's Industry Survey, or similar sources. You may also access WRDS for relevant information.


Related Discussions:- Standard ratio analysis-compound growth rates

estimate the price of the bond, Stardusts has 1 debt issue outstanding.  T...

Stardusts has 1 debt issue outstanding.  The debt matures on August 15, 2017, and has a 6.25% coupon.  Coupons are paid semiannually.  The bond is priced to yield 1.61% compound se

Prepare financial analysis of a company, Using the data provided in Appendi...

Using the data provided in Appendix 1 prepare an analysis for the attention of the directors of Meridian Ltd. The analysis should highlight the strategic differences between the co

End of Chapter Problems, The Audiology Department at Randall Clinic offers ...

The Audiology Department at Randall Clinic offers many services to the clinic''s patients. The three most common , along with cost and utilization data, are as follows: Service Var

Describe the role of insurance companies, Describe the role of insurance co...

Describe the role of insurance companies. Role of Insurance Companies: The main objective of insurance companies is to prevent individuals and firms (termed as policy-hol

Dividend cover ratio, Dividend Cover Ratio Dividend cover = EPS/ DPS =...

Dividend Cover Ratio Dividend cover = EPS/ DPS = Earning to ordinary shares/Dividend paid       This signifies the number of times dividend can be paid from earnin

Assignment, according to given specialization take down an industry and in...

according to given specialization take down an industry and investigate its managerial hierarchy to describe each of one of the managerial work level functioning

Determine what is the current market price of the bond, 1.  A company is tr...

1.  A company is trying to decide which one of two projects it should accept. Both projects have similar start-up costs. Project 1 will generate annual cash flows of $52,000 a year

Determine the firms eps, The operating income of H Ltd amounts to Rs. 18600...

The operating income of H Ltd amounts to Rs. 186000. It pays 35% tax on its income. Its capital structure consists of the following: 14% Debentures

Optimal Capital Budgeting, Capital Corporation, which has a target capital ...

Capital Corporation, which has a target capital structure of 40 percent debt and 60 percent common equity, is evaluating an expansion project with an 8.5 percent IRR. The project c

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd