Nike Vs Callaway Golf
Begin with the Balance Sheet: Respond to each question in the order listed
1. Start with the Capital Accounts. How do they differ? How are they the same? Are they realistically presented? What are the Book Values, and what are the present Ratios of the stock Prices to Book Value.
Between Nike and Callaway golf, there is a significant difference in the amounts shown. From the start, it is easy to see that both balance sheets are approximately 6 months apart from one another. While the Nike information is several months old, the Callaway Golf is nearly a year old, and is less likely to reflect the current state of affairs within the company. Regardless of this fact, the main point that is readily significant is the differences between the two companies due to their specific markets, and their size relative to one another. Retained earnings for both companies has fallen over the last three years, however while Nike has fallen only 13% in its retained earnings, Callaway has fallen 89%. Treasury stock for both companies is drastically different as well, with Nike showing none over the three-year period and Callaway reporting a negative balance. I would gather that both appear realistically presented, as I bear in mind the relative breadth of the two companies. Nike diversifies among the entire spectrum of athletic sports, while Callaway is …show more content…
Nike sits at 41.7% while Callaway is 57.1%. Both companies seem to be higher than average, but Callaway is significantly more so. This in addition to the overall company growth trends tells me that Nike is more able to deal with its debt, and may be able to acquire more in the future, but Callaway (which appears to be operating at a loss for the last three years) will not. I would say prudence would call for zero additional debt for either company until their percentage reaches closer to 30%. However, Nike has shown consistent growth while Callaway has been playing catch
1. Start with the Capital Accounts. How do they differ? How are they the same? Are they realistically presented? What are the Book Values, and what are the present Ratios of the stock Prices to Book Value.
Between Nike and Callaway golf, there is a significant difference in the amounts shown. From the start, it is easy to see that both balance sheets are approximately 6 months apart from one another. While the Nike information is several months old, the Callaway Golf is nearly a year old, and is less likely to reflect the current state of affairs within the company. Regardless of this fact, the main point that is readily significant is the differences between the two companies due to their specific markets, and their size relative to one another. Retained earnings for both companies has fallen over the last three years, however while Nike has fallen only 13% in its retained earnings, Callaway has fallen 89%. Treasury stock for both companies is drastically different as well, with Nike showing none over the three-year period and Callaway reporting a negative balance. I would gather that both appear realistically presented, as I bear in mind the relative breadth of the two companies. Nike diversifies among the entire spectrum of athletic sports, while Callaway is …show more content…
Nike sits at 41.7% while Callaway is 57.1%. Both companies seem to be higher than average, but Callaway is significantly more so. This in addition to the overall company growth trends tells me that Nike is more able to deal with its debt, and may be able to acquire more in the future, but Callaway (which appears to be operating at a loss for the last three years) will not. I would say prudence would call for zero additional debt for either company until their percentage reaches closer to 30%. However, Nike has shown consistent growth while Callaway has been playing catch