# Case Analysise

Topics: Financial ratios, Wal-Mart, Financial ratio Pages: 3 (1006 words) Published: April 19, 2012
Individual Case Analysis 1
Exercise 4a, Step 1:
1. Current Ratio: \$3,517,600/\$2,537,900= 139%, 1.39
2. Quick Ratio: \$3,406,100/\$2,537,900= 134%, 1.34
3. Debt-to-Total-Assets Ratio: \$10,217,800/ \$28,461,500=35.9%, .359 4. Debt-to-Equity Ratio: \$10,217,800/\$13,382,600= 76%, .764 5. Long-Term Debt-to-Equity Ratio: \$10,186,000/\$13,382,600=76%, .761 6. Times-Interest-Earned Ratio: \$6,442.90/\$445= 1447%, 14.48 7. Inventory Turnover : \$23,552.40/\$.11

8. Fixed Assets: \$23,522.40/\$4.71
9. Total Assets Turnover: \$23,522.40/\$28.46
10. Accounts Receivable Turnover: \$0/\$931,200
11. Average Collection Period: N/A
12. Gross Profit Margin: \$23,522.40/\$5,586.10=421%
13. Operating Profit Margin: \$6,442.90/\$23,522.40=27%
14. Net Profit Margin: \$4,313.20/23,522.40=18%
15. Return on Total Assets: \$4,313.20/\$28.46=151.55
16. Return on Stockholder’s Equity: \$4,313.20/\$12.38=336.18 17. Earnings Per Share: \$4,313.20/\$.016= 431,320
18. Price Earnings Ratio: \$3.83/\$1.625= 236%
19. Sales: \$23,522.40/\$22,786.60= 103%
20. Net Income: \$4,313.20/\$2,395.10=180%
Complete Case:
-What strategies would you recommend to current CEO Mike Duke? There are two main strategies that I would recommend to Mike Duke. The first would be Market Penetration. Wal-Mart has been successful in gaining customers from other electronic stores; however, I believe that their market share could be increased. In my personal opinion, Wal-Mart’s electronic section is equivalent to that of Best Buy. With increased consumer awareness of this, they could control a larger section of the market. Another strategy that could be used is Related Diversification. This can relate to their electronic Department by improving the products belonging to their in-house brand. Creating products equal in features to the name brands would create a possibility for increased consumption. -How can Wal-Mart benefit from Internet retailing?

Wal-Mart can benefit from...