QuickHelper

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About QuickHelper

Levels Tought:
Elementary,High School,College,University,PHD

Expertise:
Accounting,Applied Sciences See all
Accounting,Applied Sciences,Business & Finance,Chemistry,Engineering,Health & Medical Hide all
Teaching Since: May 2017
Last Sign in: 355 Weeks Ago, 4 Days Ago
Questions Answered: 20103
Tutorials Posted: 20155

Education

  • MBA, PHD
    Phoniex
    Jul-2007 - Jun-2012

Experience

  • Corportae Manager
    ChevronTexaco Corporation
    Feb-2009 - Nov-2016

Category > Accounting Posted 21 May 2017 My Price 14.00

Which investment is better out of the two Investments listed?

Question description

 

Excel spreadsheet and 3 page APA style paper. The next step for Dr. Bueller is to help him compare stocks and make good investment decisions. With that in mind, you want to compare Industrial Company #1 with its top rival Industrial Company #2 and explain to Dr. Bueller which one would make a better investment.

In preparation for sharing your thoughts with Dr. Bueller,

  • Operating income margin
  • Net income margin
  • Current ratio
  • Earnings per share
  • Price-to-earnings (P/E) ratio.

Industrial Company #1

(in millions)

2008

2009

2010

Sales

$4,250

$4,500

$4,750

Operating Income

$400

$445

$480

Net Income

$200

$225

$250
       

Current Assets

$2,500

$2,750

$2,850

Current Liabilities

$2,300

$2,450

$2,500
       

Shares Outstanding

100

100

100

Average Stock Price

$32

$39

$50

Industrial Company #2

(in millions)

2008

2009

2010

Sales

$3,350

$3,750

$4,250

Operating Income

$335

$395

$470

Net Income

$168

$198

$240
       

Current Assets

$1,750

$1,900

$2,100

Current Liabilities

$1,350

$1,400

$1,500
       

Shares Outstanding

80

80

80

Av Stock Price

$38

$46

$62
 

2010 Industry Avg.

Operating Margin

10.50%

Net Margin

5.50%

Current Ratio

1.25

Earnings/Share

$2.75

PE Ratio

20.0

Group Project Guidelines

  • Perform the calculations of the following values for both Industrial Company #1 and Industrial Company #2 using the information from the data tables located in the Assignment Description:
    • Operating income margin
    • Net income margin
    • Current ratio
    • Earnings per share
    • Price-to-earnings (P/E) ratio.
  • Must organize your calculations in an Excel spreadsheet
    • In your own words, explain the significance of each calculation.
  • Write a 3 page (body of paper), in a Word document, about which company is a better investment.

Answers

QuickHelper
(10)
Status NEW Posted 21 May 2017 04:05 PM My Price 14.00

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