- Fill in the following information for the seven non-financial companies of your choice. (2%)
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Company name
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Firm 2
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Firm 3
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Firm 4
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Firm 5
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Firm 6
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Firm 7
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Current Ratio
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Debt/Equity Ratio
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Asset Turnover
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Profit Margin
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Price to Earning
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Market to Book
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Closing Stock price
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b. Please explain the ratios of the firms to the potential investors of these seven stocks.(Use the structure of the textbook and compare them with the industry averages, if possible) (2%)
“Tentative answer:
For XYZ firm,
Short-term solvency or liquidity ratios: The current ratio is smaller than one, which is not that great.
Long-term solvency or financial leverage ratios: The total debt ratio is 0.58, which is in a good shape.
Asset management or turnover ratios: Asset turnover is 2.38. This is high. Walmart utilizes its assets well.
Profitability ratios:
Market value ratios: Both Market to Book and Price to earning ratios are below the industry averages. The stock is underpriced.
For ABC Firm…..”
Search from the WSJ and/or Bloomberg to quote the valuation of your stocks with clear citation and contents