Liquidity: It would seem that Microsoft has the advantage here in that they have what seems to be a pretty good number of 14.8 times in pushing their shares, but they seem to take a little longer in how many days it takes to get their inventory out where Oracle beats them at 13 days less. Solvency: Microsoft has the advantage here because they can cover their interest expenses better with their cash flows. Microsoft has $19459 Billion where as Oracle only has $9,703 to cover their expenses. Microsoft will have a better chance of paying down their debt and make other financial decisions that will better profit the company. Profitability: Microsoft has the upper hand in profitability just by looking at their numbers. Microsoft is bringing in more money percentage wise and will have a easier time of staying above the competition. Conclusion: In conclusion, Microsoft excells in the majority of areas with only a few that they fall short in, the summary of calculations are as followes: in earnings per share Microsoft leads by 1.04, in current ratio Microsoft falls behind by 2.58 , in gross profit ratio Microsoft leads by 1.3%, in profit margin ratio Microsoft leads by 9.1%, in inventory turnover Microsoft leads by 15.1, in days in inventory Microsoft falls behind by 13, in receivable turnover ratio both companies are close but Microsoft take it my only .8, in assets turnover ratio Microsoft leads by .19 , in return on assets ratio Microsoft leads by 11.1, in debt to total assets ratio Oracle leads with 15.1%, as in times interest earned ratio Microsoft leads by 81.1. These numbers are not surprising being that Microsoft is the world’s largest software company. This would indicate that even though Oracle is doing good, they are struggling to stay in competition with Microsoft.
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