Lowe's Financial Summary
Business Description: Lowe’s companies, Inc. established 72 years ago at the year of 1921, Its a home improvement retailer, functions through the United States for building materials and supplies. Headquartered in North Wilkesboro, North Carolina, serves more than 17 million customers a week from all stores. Currently, Lowe’s operates in 1,820 stores within the United States and 310 stores internationally in Canada and Mexico. Lowe’s is known as the second largest US home appliances retailer after Sears.
Firms with excessive liabilities may run into severe trouble, even if they are otherwise successful entities. In finance, the term leverage refers to the ration between the firm 's liabilities and equity and is calculated by dividing total liability by shareholder equity. Note that some analysts prefer to use only long-term liabilities, which are payment obligations coming due in one year or more, when calculating leverage. The more common leverage formula, however, incorporates all liabilities. If stockholder equity is less than total liability, the firm 's leverage ratio will be greater than 1.
Their current ratio improved from 1.59 to 2.44 which shows the ability to cover current liabilities has improved. Massachusetts Stove Company strategically made decisions to not only increase their current assets quickly but also managed their liabilities to keep them from growing out of control. This means that the company could cover current liabilities at any time relatively easily with their cash, receivables, or other current assets. In terms of the market, Massachusetts Stove Company does have the demand of 220,000 active prospects they could try to sell stoves too if a dire need arose for quick cash. Management even brought their quick ratio to 1.08.
Annual Reports and Press releases The annual reports and press releases of both companies slightly differ though with a portion of similarity. Although, Home Depot’s annual report is composed at the headquarters of giving an inclusive report on all of the retail stores in the world, through the company’s website these reports posted can be found. Therefore, this being impartial and all-inclusive to an extent of analysis it would have to be done on the contrasts, similarities, profitability, and performance of different retail stores in different regions or countries. However, the shareholders and customers analyze the summary provided to know the general performance.
When I wish to do home improvement or purchase home materials, I think of Lowes or Home Depot. I also think about Sherwin Williams, Builder’s Supply, and Ace Hardware. While I was looking for further information on Lowes, I discovered that Lowes has done a great job and is number two in the home improvement industry. To be truthful, my class project for my Financial Statement Analysis was on Home Depot and Lowes. I got a good idea about where Lowes was financially, but I thought I’d like to know more about their business side as well.
Target Corporation is the second largest discount store retailer in the United States following Walmart. Target provides high-quality, trendy merchandise at logical prices. As of today, Target has more than 1800 retail stores and 38 distribution centers in the United States. The first official store was opened in 1962 in Roseville Minnesota and have thrived every since. I will be analyzing Target’s financial statements and communicating the results to our decision makers (Target 2017).
The debt to ratio is a ratio that compares a firms total liabilities and shareholders’ equity. It shows the proportion of the amount of money invested by the business owners as well as external entities. Debt to Equity Ratio = Total Liabilities/Shareholders’ Equity = $80,994/$931,490
The History of Sunland Inc. Sunland Incorporation was a production company established in Portales, New Mexico in the late 1980’s, the company was built on “70 acres of land owned by Sunland, Incorporated”. Sunland soon established itself as one of the nation’s largest processors of organic peanut butter. By using the Valencia type of peanuts, the company was able to produce, grow, and market approximately “240 different types of peanut products”. Ranging from candies to lipstick to kitty litter to fireplace logs”.
Overall, the increased debt is justifiable as they are producing a lot more, but it does hinder their liquidity and ability to take on more debt. In 2015 the company had a gross margin at 30.8% which was higher than the industry. This is a good indication that the
T.J. Maxx is an off-price retailer, which it operates by offering brand name merchandise 20 -60% below department store prices, by purchasing merchandise when other retail stores close, or have overruns, or unexpected changes in demand and pass these savings on to their customers. The 33-billion-dollar plus company has been successful due to low cost structure, strong vendor relationships and flexible business model. As a consumer of goods, customers return to TJ Maxx due to the cost savings that they are unable to obtain at the department stores. Globalization is the essence of earnings growth at T.J. Maxx due to its success in Europe. Kowitt (2014) noted that retailers in the United States struggle in Europe, but T.J. Maxx excelled by hiring European buyers to buy European products instead of trying to force American
I decided to choose “Red Robin” as my example. The financial statements are important to a business because it provides a comprehension into how a company is generating their finances and how all the cost in between are related, how the strengths and leakages are depicted on the financial statements (MURPHY, 2023). The financial statements are beneficial to owners as it clarifies the company’s financial health and also what the cash flow looks like, to investors it would give a broader picture of what they are or did invest in, therefore Red Robin’s owners and shareholders can be reassured that the company’s financial health is in a good state (Maverick, 2022).
SNC was able to increase its total firm value by $1,834,000 and its total equity value by $1,581,000, in 2012 dollars. On average, this attributed to an increase of approximately $203,778 a year in firm value. After a complete analysis of the company, SNC has proven and established itself as a trustworthy company, and it is expected that the market will reward SNC with lower risk. From 2010-2021, the equity multiplier decreased about four times from an average of 3.65 to an average of 1.10. The risks associated with taking on debt are mitigated due to SNC’s decreased leverage.
Introduction The main objective of this particular case study is to assist Victor Dubinski, the current CEO of Blaine Kitchenware, decide whether or not repurchasing shares and changing the firm’s capital structure in favor of more debt could actually be benefit the company and its shareholders. Blaine Kitchenware is a small cap, public company who focuses on selling various different residential kitchen appliances. Up until this point, the company has only used cash and equity financing to acquire independent kitchen appliance manufacturers, and expand into foreign markets abroad. Given their excess cash and lack of debt, Blaine Kitchenware is considered to be “over-liquid and under-leveraged” (Luehrman & Heilprin, 2009).
The second key strategy was developed because of the successes of Liberty Mutual. How forward thinking is that!! As our CEO, David Long suggest,” Success is the reason why we can and should seek continuous improvement now.” (LMIG, 2014) The philosophy behind this is that Liberty Mutual is building on an already existing foundation of strong principles, a deep knowledge of existing processes and customer relationships and products. Another facet to this is that the company’s rapid growth has brought greater complexity and challenges to how employees work, and it’s not going away.
The company increased its long-term debt from 20 million to over 530 million from 2006 to 2011. This significantly increased its Debt to Equity Ratio from 0.18 to 1.17 over the previous fiver years. The increase in debt also hindered the company's current ratio and interest coverage ratio as time went on. As seen by the debt covenants and the decline in AP days, creditors began to feel uneasy about the amount of debt being taken on by the company. In a relatively short period of time a walnut distributor had taken the snack segment by storm and was poised to make a multi-billion dollar bid for Pringles.
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