Seracor Financial Analysis
1). Return on assets.
Net income 58,333
Total assets (Total liabilities + Stockholders equity) 1,404,726
Return on assets 4.2% =net income/1,404,726
2). Return on stockholders’ equity
Net income 58,333
Stockholders equity 176,413
Return on equity 33.1%
3). Debt to asset ratio
Debt 648,020
Total assets 1,404,726
Debt to assets ratio is equal to46% debt/total assets
A). Briefly discuss the operating performance and financial position of Sepracor. Industry averages for these ratios in 2007 were: ROA 3.5%; return on equity 16%; and debt to assets 75%. Based on this analysis would you make an investment in the company’s 5% convertible bonds? Explain. Sepracor Industry
ROA
Net income 58,333
Total assets (Total liabilities + Stockholders equity) 1,404,726
Return on assets 4.2% =net income/1,404,726
2). Return on stockholders’ equity
Net income 58,333
Stockholders equity 176,413
Return on equity 33.1%
3). Debt to asset ratio
Debt 648,020
Total assets 1,404,726
Debt to assets ratio is equal to46% debt/total assets
A). Briefly discuss the operating performance and financial position of Sepracor. Industry averages for these ratios in 2007 were: ROA 3.5%; return on equity 16%; and debt to assets 75%. Based on this analysis would you make an investment in the company’s 5% convertible bonds? Explain. Sepracor Industry
ROA