大学课件：公司金融学ch10.ppt

1、10-1nRatio analysisnDu Pont systemnEffects of improving ratiosnLimitations of ratio analysisnQualitative factorsCHAPTER 10 Analysis of Financial Statements10-2Income Statement 2002 2003ESales5,834,400 7,035,600COGS4,980,000 5,800,000Other expenses720,000 612,960Deprec.116,960 120,000 Tot.op.costs 5,

2、816,960 6,532,960 EBIT17,440 502,640Int.expense176,000 80,000 EBT(158,560)422,640Taxes(40%)(63,424)169,056Net income(95,136)253,58410-3Balance Sheets:Assets 2002 2003ECash7,282 14,000S-T invest.20,000 71,632AR632,160 878,000Inventories1,287,360 1,716,480 Total CA1,946,802 2,680,112 Net FA939,790 836

3、,840Total assets2,886,592 3,516,95210-4Balance Sheets:Liabilities&Equity 2002 2003EAccts.payable324,000 359,800Notes payable720,000 300,000Accruals284,960 380,000 Total CL1,328,960 1,039,800Long-term debt 1,000,000 500,000Common stock460,000 1,680,936Ret.earnings97,632 296,216 Total equity557,632 1,

4、977,152Total L&E2,886,592 3,516,95210-5Other Data20022003EStock price$6.00$12.17#of shares100,000 250,000EPS-$0.95$1.01DPS$0.11$0.22Book val.per share$5.58$7.91Lease payments40,00040,000Tax rate0.40.410-6nStandardize numbers;facilitate comparisonsnUsed to highlight weaknesses and strengthsWhy are ra

5、tios useful?10-7nLiquidity:Can we make required payments as they fall due?nAsset management:Do we have the right amount of assets for the level of sales?What are the five major categories of ratios,and what questions do they answer?(More)10-8nDebt management:Do we have the right mix of debt and equi

6、ty?nProfitability:Do sales prices exceed unit costs,and are sales high enough as reflected in PM,ROE,and ROA?nMarket value:Do investors like what they see as reflected in P/E and M/B ratios?10-9Calculate the firms forecasted current and quick ratios for 2003.CR03=2.58x.QR03=0.93x.CACL$2,680$1,040$2,

7、680-$1,716$1,040CA-Inv.CL10-10nExpected to improve but still below the industry average.nLiquidity position is weak.Comments on CR and QR2003E20022001Ind.CR2.58x1.46x2.3x2.7xQR0.93x0.5x0.8x1.0 x10-11What is the inventory turnover ratio as compared to the industry average?Inv.turnover=4.10 x.SalesInv

8、entories$7,036$1,7162003E20022001Ind.Inv.T.4.1x4.5x4.8x6.1x10-12nInventory turnover is below industry average.nFirm might have old inventory,or its control might be poor.nNo improvement is currently forecasted.Comments on Inventory Turnover10-13ReceivablesAverage sales per dayDSO is the average numb

9、er of days after making a sale before receiving cash.DSO=45.5 days.ReceivablesSales/365$878$7,036/36510-14Appraisal of DSOn Firm collects too slowly,and situation is getting worse.n Poor credit policy.200320022001Ind.DSO45.539.537.432.010-15Fixed Assets and Total AssetsTurnover RatiosFixed assetstur

10、nover Sales Net fixed assets=8.41x.$7,036$837Total assetsturnover Sales Total assets=2.00 x.$7,036$3,517(More)10-16nFA turnover is expected to exceed industry average.Good.nTA turnover not up to industry average.Caused by excessive current assets(A/R and inventory).2003E 2002 2001 Ind.FA TO8.4x6.2x1

11、0.0 x7.0 xTA TO2.0 x2.0 x2.3x2.5x10-17 Total liabilities Total assetsDebt ratio=43.8%.$1,040+$500$3,517 EBIT Int.expense TIE=6.3x.$502.6$80Calculate the debt,TIE,and EBITDA coverage ratios.(More)10-18All three ratios reflect use of debt,but focus on different aspects.EBITDAcoverage=EC=5.5x.EBIT+Depr

12、.&Amort.+Lease payments Interest Lease expense pmt.+Loan pmt.$502.6+$120+$40$80+$40+$010-19Recapitalization improved situation,but lease payments drag down EC.How do the debt management ratios compare with industry averages?2003E 20012 2001 Ind.D/A43.8%80.7%54.8%50.0%TIE6.3x0.1x3.3x6.2xEC5.5x0.8x2.6

13、x8.0 x10-20Very bad in 2002,but projected to meet industry average in 2003.Looking good.Profit Margin(PM)2003E20022001Ind.PM3.6%-1.6%2.6%3.6%PM =3.6%.NI Sales$253.6$7,03610-21BEP=14.3%.Basic Earning Power(BEP)EBIT Total assets$502.6$3,517(More)10-22nBEP removes effect of taxes and financial leverage

14、.Useful for comparison.nProjected to be below average.nRoom for improvement.2003E20022001Ind.BEP14.3%0.6%14.2%17.8%10-23Return on Assets(ROA)and Return on Equity(ROE)ROA=7.2%.Net income Total assets$253.6$3,517(More)10-24ROE=12.8%.Net income Common equity$253.6$1,977 2003E 2002 2001 Ind.ROA7.2%-3.3%

15、6.0%9.0%ROE12.8%-17.1%13.3%18.0%Both below average but improving.10-25nROA is lowered by debt-interest expense lowers net income,which also lowers ROA.nHowever,the use of debt lowers equity,and if equity is lowered more than net income,ROE would increase.Effects of Debt on ROA and ROE10-26Calculate

16、and appraise theP/E,P/CF,and M/B ratios.Price=$12.17.EPS=$1.01.P/E=12x.NIShares out.$253.6250Price per shareEPS$12.17$1.0110-27Industry P/E RatiosIndustryTicker*P/EBankingSTI17.6SoftwareMSFT33.0DrugPFE31.7Electric UtilitiesDUK13.7SemiconductorsINTC57.5SteelNUE28.1TobaccoMO12.3Water UtilitiesCFT21.8S

17、&P 500 30.4*Ticker is for typical firm in industry,but P/E ratio is for the industry,not the individual firm.10-28 NI+Depr.Shares out.CF per share=$1.49.$253.6+$120.0250 Price per share Cash flow per share P/CF=8.2x.$12.17$1.4910-29 Com.equity Shares out.BVPS=$7.91.$1,977250 Mkt.price per share Book

18、 value per share M/B=1.54x.$12.17$7.9110-30nP/E:How much investors will pay for$1 of earnings.High is good.nM/B:How much paid for$1 of book value.Higher is good.nP/E and M/B are high if ROE is high,risk is low.2003E 2002 2001 Ind.P/E12.0 x-6.3x9.7x14.2xP/CF8.2x27.5x8.0 x7.6xM/B1.5x1.1x1.3x2.9x10-31C

19、ommon Size Balance Sheets:Divide all items by Total AssetsAssets200120022003EInd.Cash0.6%0.3%0.4%0.3%ST Invest.3.3%0.7%2.0%0.3%AR23.9%21.9%25.0%22.4%Invent.48.7%44.6%48.8%41.2%Total CA76.5%67.4%76.2%64.1%Net FA23.5%32.6%23.8%35.9%TA100.0%100.0%100.0%100.0%10-32Divide all items by Total Liabilities&E

20、quity200120022003EInd.AP9.9%11.2%10.2%11.9%Notes pay.13.6%24.9%8.5%2.4%Accruals9.3%9.9%10.8%9.5%Total CL32.8%46.0%29.6%23.7%LT Debt22.0%34.6%14.2%26.3%Total eq.45.2%19.3%56.2%50.0%Total L&E 100.0%100.0%100.0%100.0%10-33Analysis of Common Size Balance SheetsnComputron has higher proportion of invento

21、ry and current assets than Industry.nComputron now has more equity(which means LESS debt)than Industry.nComputron has more short-term debt than industry,but less long-term debt than industry.10-34Common Size Income Statement:Divide all items by Sales200120022003EInd.Sales100.0%100.0%100.0%100.0%COGS

22、83.4%85.4%82.4%84.5%Other exp.9.9%12.3%8.7%4.4%Depr.0.6%2.0%1.7%4.0%EBIT6.1%0.3%7.1%7.1%Int.Exp.1.8%3.0%1.1%1.1%EBT4.3%-2.7%6.0%5.9%Taxes1.7%-1.1%2.4%2.4%NI2.6%-1.6%3.6%3.6%10-35Analysis of Common Size Income StatementsnComputron has lower COGS(86.7)than industry(84.5),but higher other expenses.Resu

23、lt is that Computron has similar EBIT(7.1)as industry.10-36Percentage Change Analysis:Find Percentage Change from First Year(2001)Income St.200120022003ESales0.0%70.0%105.0%COGS0.0%73.9%102.5%Other exp.0.0%111.8%80.3%Depr.0.0%518.8%534.9%EBIT0.0%-91.7%140.4%Int.Exp.0.0%181.6%28.0%EBT0.0%-208.2%188.3

24、%Taxes0.0%-208.2%188.3%NI0.0%-208.2%188.3%10-37Analysis of Percent Change Income StatementnWe see that 2003 sales grew 105%from 2001,and that NI grew 188%from 2001.nSo Computron has become more profitable.10-38Percentage Change Balance SheetsAssets200120022003ECash0.0%-19.1%55.6%ST Invest.0.0%-58.8%

25、47.4%AR0.0%80.0%150.0%Invent.0.0%80.0%140.0%Total CA0.0%73.2%138.4%Net FA0.0%172.6%142.7%TA0.0%96.5%139.4%10-39Liab.&Eq.200120022003EAP0.0%122.5%147.1%Notes pay.0.0%260.0%50.0%Accruals0.0%109.5%179.4%Total CL0.0%175.9%115.9%LT Debt0.0%209.2%54.6%Total eq.0.0%-16.0%197.9%Total L&E0.0%96.5%139.4%10-40

26、Analysis of Percent Change Balance SheetsnWe see that total assets grew at a rate of 139%,while sales grew at a rate of only 105%.So asset utilization remains a problem.10-41Explain the Du Pont SystemnThe Du Pont system focuses on:lExpense control(PM)lAsset utilization(TATO)lDebt utilization(EM)nIt

27、shows how these factors combine to determine the ROE.10-42()()()=ROE ProfitmarginTAturnoverEquitymultiplier NI SalesSalesTA TA CE20012.6%x 2.3x2.2=13.2%2002-1.6%x2.0 x5.2=-16.6%20033.6%x2.0 x1.8=13.0%Ind.3.6%x2.5x2.0=18.0%The Du Pont Systemxx=ROE.10-43What are some potential problems and limitations

28、 of financial ratio analysis?nComparison with industry averages is difficult if the firm operates many different divisions.n“Average”performance is not necessarily good.nSeasonal factors can distort ratios.(More)10-44nWindow dressing techniques can make statements and ratios look better.nDifferent a

29、ccounting and operating practices can distort comparisons.nSometimes it is difficult to tell if a ratio value is“good”or“bad.”nOften,different ratios give different signals,so it is difficult to tell,on balance,whether a company is in a strong or weak financial condition.10-45What are some qualitati

30、ve factors analysts should consider when evaluating a companys likely future financial performance?nAre the companys revenues tied to a single customer?nTo what extent are the companys revenues tied to a single product?nTo what extent does the company rely on a single supplier?(More)10-46nWhat percentage of the companys business is generated overseas?nWhat is the competitive situation?nWhat does the future have in store?nWhat is the companys legal and regulatory environment?