FIN 515 Managerial Finance Week 3 First Course Project Answer
First Course Project
For this course project, I have chosen Cisco Systems, Inc. and tried to do the DuPont analysis for this company. Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol (IP) based networking products and services related to the communications and information technology industry worldwide. Cisco also provides broad line of products for transporting data, voice, and video within buildings, across campuses, and around the world. Various products offered by Cisco are switching, NGN routing, collaboration portfolio integrating voice, video, data and mobile applications data center and other networking products. Cisco Systems has a market cap of $128.77 billion and is part of the technology sector and computer hardware industry. Cisco's Collaboration portfolio integrates voice, video, data and mobile applications on fixed and mobile networks across a wide range of devices and endpoints from mobile phones and tablets to desktops, Macs and laptops to desktop virtualization clients. (http://www.forbes.com).
Using data collected from Cisco Company site and related site, I was able to do the following calculation. The below figures are given in M $ for Cisco Company:
12 months ended( In M$)
Jul 26, 2014
Jul 27, 2013
Jul 28, 2012
Revenue
47,142
48,607
46,061
Net income
7853
9983
8041
Total assets
105134
101191
91759
Total equity
56661
59128
51301
Revenue
47142
48607
46061
Calculation done:
Net Profit Margin
16.66%
20.54%
17.46%
Asset Turnover
0.448
0.480
0.502
Equity Multiplier
1.855
1.711
1.789
DuPont Return on Equity
0.139
0.169
0.157
ROE, Competitors
Qualcomm Inc.
20.34%
18.99%
18.22%
ROE, Sector
Telecommunications Equipment
–%
17.68%
16.68%
ROE, Industry
Technology
–%
23.13%
21.80%
Results of DuPont Analysis for CISCO:
The net profit margin is the after tax profit a company generates for each dollar of revenue. A higher net profit margin is usually preferable as this indicates that the company
For this course project, I have chosen Cisco Systems, Inc. and tried to do the DuPont analysis for this company. Cisco Systems, Inc. designs, manufactures, and sells Internet Protocol (IP) based networking products and services related to the communications and information technology industry worldwide. Cisco also provides broad line of products for transporting data, voice, and video within buildings, across campuses, and around the world. Various products offered by Cisco are switching, NGN routing, collaboration portfolio integrating voice, video, data and mobile applications data center and other networking products. Cisco Systems has a market cap of $128.77 billion and is part of the technology sector and computer hardware industry. Cisco's Collaboration portfolio integrates voice, video, data and mobile applications on fixed and mobile networks across a wide range of devices and endpoints from mobile phones and tablets to desktops, Macs and laptops to desktop virtualization clients. (http://www.forbes.com).
Using data collected from Cisco Company site and related site, I was able to do the following calculation. The below figures are given in M $ for Cisco Company:
12 months ended( In M$)
Jul 26, 2014
Jul 27, 2013
Jul 28, 2012
Revenue
47,142
48,607
46,061
Net income
7853
9983
8041
Total assets
105134
101191
91759
Total equity
56661
59128
51301
Revenue
47142
48607
46061
Calculation done:
Net Profit Margin
16.66%
20.54%
17.46%
Asset Turnover
0.448
0.480
0.502
Equity Multiplier
1.855
1.711
1.789
DuPont Return on Equity
0.139
0.169
0.157
ROE, Competitors
Qualcomm Inc.
20.34%
18.99%
18.22%
ROE, Sector
Telecommunications Equipment
–%
17.68%
16.68%
ROE, Industry
Technology
–%
23.13%
21.80%
Results of DuPont Analysis for CISCO:
The net profit margin is the after tax profit a company generates for each dollar of revenue. A higher net profit margin is usually preferable as this indicates that the company
References: http://www.stock-analysis-on.net/NASDAQ/Company/Cisco-Systems-Inc/Financial-Statement/Income-Statement http://www.marketwatch.com/story/cisco-systems-reports-slight-sales-growth-2014-11-12-164853634 http://www.stock-analysis-on.net/NASDAQ/Company/Cisco-Systems-Inc/Ratios/Profitability http://www.forbes.com/companies/cisco-systems/