Analysis of Tootsie Roll Industries

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Analysis of Tootsie Roll Industries, Inc. 2002

1. Tootsie Roll Industries, Inc. has been in the candy business for 106 year and has a reputation for success. The company sells products primarily under the brand names of Tootsie Roll, Tootsie Roll Pops, Caramel Apple Pops, Child’s Play, Charms, Blow Pop, Junior Mints, Charleston Chew, Sugar Daddy, Andes and Fluffy Stuff cotton candy, as well as several others. The company prides itself in maintaining a positive reputation by supporting the U.S Armed Forces. The company thinks more long-term and has remained quite steady over the last few years, despite increased ingredient prices.

2. Data Used: (all in thousands except Stock Dividends, Average Common Shares Outstanding and Stock Price Per Share)
Net Income: $66388
Interest Expense: $309
Total Assets: $646080
Preferred Stock Dividends: $0695
Average Common Shares Outstanding: 51553
Stock Price Per Share: $37.48
Current Assets: $224948
Current Liabilities: $63096
Total Liabilities: $119340
Cash From Operations: $71203
Average Current Liabilities: $60471
Gross Profit: $172420
Net Sales: $393185
Cost Of Goods Sold: $220765
Average Inventory: $41903.50
Net Credit Sales: $22686
Average Net Receivables: $21544.50
Average Total Assets: $632378
Tax Expense: $34099
Average Total Liabilities: $114777.50

3. Evaluation of Information:
a. Earnings per share = (66388-.0695)/51553 = 1.29
b. Price-Earnings Ratio = 37.48/1.29 = 29.05
c. Working Capital = 224948-63096 = 161852
d. Current Ratio = 224948/63096 = 3.57
e. Debt to Total Assets Ratio = 119310/646080 = .18
f. Current Cash Debt Coverage = 71203/60471 = 1.177
g. Cash Debt Coverage = 71203/114777.5 = .62
h. Gross Profit Rate = 172420/393185 = .44
i. Profit Margin = 66388/393185 = .17
j. Inventory Turnover Ratio = 220765/41903.5 = 5.27
k. Days in Inventory = 365/5.27 = 69.26
l. Type of Inventory Cost Flow Assumption: FIFO
m. Receivables Turnover Ratio...
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