Ray Espinal - Coca Cola
Ray Espinal
Bus 635
Case study #1
04/14/2013
Health Company
Cash and short-term investment for Company A (24.2%) is higher than Company B (16.1%). Company A has higher receivables (12.8%) than Company B, 8.1%. This is probably because Company A distributes their products to institutions like hospitals, clinics and etc. Institutions take longer time to pay, while Company B distributes their diversified health-products to end-consumers or to the mass market by cash settlement or short credit term. Inventory turnover for Company A (3.08x) is higher than Company B (0.93x), that means inventories are sold and replaced faster than Company B. Company A has higher turnover because those institutions, especially hospitals “consume” health products faster and more. On the other hand, Company A has net fixed assets of 19.6%, higher than Company B (14.9%), which probably because Company A has more equipments to support their robust research and development. Intangibles e.g. goodwill for Company B (46.1%) is higher compared to Company A (22.2%). Because B focuses more on their brand development, company B (88.9%) has a higher gross profit margin most likely because the firm not only manufactures and mass markets a broad line of prescription pharmaceuticals, over-the-counter remedies, consumer health and beauty products but also manufactures medical diagnostics and devices. Company A is lower (76.1%) due to its limited product range (only manufactures drugs). In conclusion, Company A fits the descriptions of PFIZER. While Company B fits the second set of descriptions of. Johnson and Johnson.
Beer Industry
From these ratios above we can conclude that Company D is healthier than Company C in the Beer Industry. Apart from the net profit margin, Company D is able to turn their assets into liquidity at a faster rate of 2.43x than Company C. The productivity in which they are able to utilize their resources to generate sales and profits is 11.67 higher than
Bus 635
Case study #1
04/14/2013
Health Company
Cash and short-term investment for Company A (24.2%) is higher than Company B (16.1%). Company A has higher receivables (12.8%) than Company B, 8.1%. This is probably because Company A distributes their products to institutions like hospitals, clinics and etc. Institutions take longer time to pay, while Company B distributes their diversified health-products to end-consumers or to the mass market by cash settlement or short credit term. Inventory turnover for Company A (3.08x) is higher than Company B (0.93x), that means inventories are sold and replaced faster than Company B. Company A has higher turnover because those institutions, especially hospitals “consume” health products faster and more. On the other hand, Company A has net fixed assets of 19.6%, higher than Company B (14.9%), which probably because Company A has more equipments to support their robust research and development. Intangibles e.g. goodwill for Company B (46.1%) is higher compared to Company A (22.2%). Because B focuses more on their brand development, company B (88.9%) has a higher gross profit margin most likely because the firm not only manufactures and mass markets a broad line of prescription pharmaceuticals, over-the-counter remedies, consumer health and beauty products but also manufactures medical diagnostics and devices. Company A is lower (76.1%) due to its limited product range (only manufactures drugs). In conclusion, Company A fits the descriptions of PFIZER. While Company B fits the second set of descriptions of. Johnson and Johnson.
Beer Industry
From these ratios above we can conclude that Company D is healthier than Company C in the Beer Industry. Apart from the net profit margin, Company D is able to turn their assets into liquidity at a faster rate of 2.43x than Company C. The productivity in which they are able to utilize their resources to generate sales and profits is 11.67 higher than