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    Analysis of financial statements: Lowes vs Home Depot

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    Analyze the ratios of both companies using the ratios below (see data attached in excel). Refer to the financial statements for this section in order to expand the information base and gain insight into the numbers and the ratios. Explain your conclusion about their financial status using the ratios and consider how the ratios are related.

    Home Depot
    PROFITABILITY

    Return On Assets
    Return On Invested Capital
    Cash Flow To Sales
    Cost of Goods Sold To Sales
    Gross Profit Margin
    Operating Profit Margin
    Pretax Margin
    Net Margin

    Lowes
    PROFITABILITY

    Return On Assets
    Return On Invested Capital
    Cash Flow To Sales
    Cost of Goods Sold To Sales
    Gross Profit Margin
    Operating Profit Margin
    Pretax Margin
    Net Margin

    Home Depot
    ASSET UTILIZATION

    Assets Per Employee
    Assets Turnover
    Inventory Turnover
    Capital Expend Pct Total Assets
    Capital Expend Pct Sales

    Lowes
    ASSET UTILIZATION

    Assets Per Employee
    Assets Turnover
    Inventory Turnover
    Capital Expend Pct Total Assets
    Capital Expend Pct Sales

    Home Depot
    LEVERAGE

    Total Debt Pct Common Equity
    LT Debt Pct Common Equity
    LT Debt Pct Total Capital
    Equity Pct Total Capital
    Total Debt Pct Total Assets
    Common Equity Pct Total Assets
    Total Capital Pct Total Assets
    Dividend Payout
    Cash Dividend Coverage Ratio
    Working Cap Pct Total Capital

    Lowes
    LEVERAGE

    Total Debt Pct Common Equity
    LT Debt Pct Common Equity
    LT Debt Pct Total Capital
    Equity Pct Total Capital
    Total Debt Pct Total Assets
    Common Equity Pct Total Assets
    Total Capital Pct Total Assets
    Dividend Payout
    Cash Dividend Coverage Ratio
    Working Cap Pct Total Capital

    Home Depot
    LIQUIDITY

    Quick Ratio
    Current Ratio
    Cash Ratio
    Receivables Pct Current Assets
    Accounts Receivable Days
    Inventories Days Held

    Lowes
    LIQUIDITY

    Quick Ratio
    Current Ratio
    Cash Ratio
    Receivables Pct Current Assets
    Accounts Receivable Days
    Inventories Days Held

    © BrainMass Inc. brainmass.com May 20, 2020, 7:50 pm ad1c9bdddf
    https://brainmass.com/business/wto-and-gatt/361020

    Attachments

    Solution Preview

    I put text boxes on each of the four ratio tabs. I computed a few additional ratios and attached the actual financial ...

    Solution Summary

    This is a classic assignment: analyze two competitors in the same industry. The ratios are examined and discussed in four sections in everyday language the novice can grasp. The ratios were downloaded from BIZSTAT and so the actual computation (numerator and denominator) are not in the solution. This is coaching on interpreting (not computing) ratios.

    $2.19

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