Review the financial statements of General Mills and Meiji Holdings Co., Ltd.
List items in the equity section.
Are there preferred shares?
Any treasury stock?
List basic and diluted EPS
Any discontinued operations?
Any stock compensation plans? What method to value stock? Stock compensation expense reported?
Compute these ratios and discuss the "story" they tell:
• Profitability ratios:
o Gross profit margin
o Net profit margin
o Return on stockholders' equity
• Liquidity ratios:
o Current ratio
o Quick ratio
o Inventory turnover
• Leverage ratios:
o Times-covered ratio
The items are discussed and sections of the 2013 annual reports are shown (cut and paste) so you can see where they find the answers. Ratios are shown (numerator and denominators) in excel.
Analysis of Financial Reports for General Mills and Meiji Holdings and Determining Profitability Between the Companies
General Mills http://www.generalmills.com
Meiji Holdings Co., Ltd. http://www.meiji.com/english/corporate/data/group/
Prepare a table for a period of three years showing some key financial information for the two companies. Include at least four items from the balance sheet, four items from the income statement, and four items from the statement of cash flow. Having reviewed and analyzed the financial information, please elaborate on the following three questions:
1.Which one of the two companies is the most profitable?
2.Compare growth of revenues versus income over time and between the two companies.
3.How can you explain the difference in profitability between the two companies?
4.Indicate in detail the information you used to answer the above questions