Target and Walmart are both classified as “Big-Box general merchandise retailers.” Both hypermarkets are household names known for their accessibility, location and variety of merchandise. Target has been in the industry since 1902 and Walmart since 1962. While staying relevant in their markets, they have become each other’s biggest competitors with their level of notability. The following paper will showcase my Financial Statement Analysis Report for the two companies. Based on popularity alone, both companies are safe to invest in, despite the numbers and ratios suggesting otherwise. WMT has considerably higher Earnings Per Share than TGT. The respective EPS for both companies is 4.15 and 0.90. According to the Form 10-K provided by EDGAR, …show more content…
When it comes to the current ratio as well as the quick ratio, TGT tops WMT in both aspects. Regarding the current ratio, TGT beats WMT by a difference of 0.08. That said, the range for a good current ratio should be between 1.2-2, and since TGT and WMT are decently out of range, their companies are not the best for short-term debt relief. As for the quick ratio, TGT also beats WMT by not much, more specifically 0.02. However, these numbers are unreliable for the company and provide evidence that they both often fail to meet their short-term commitments to liquidity. The debt-to-equity ratio for both WMT and TGT is higher than suggested, being 2.08 and 3.12, respectively. Dealing with the numbers given to us, WMT does end up having a better debt-to-equity ratio than TGT. We can conclude that WMT has less debt compared to its assets than TGT does, but still has a larger than average amount. TGT meets and exceeds the recommended return on equity with over twice as much growth per year than WMT. A return on equity amount around 15-20% is generally considered good, so TGT’s 33% proves the company to be a great investment, considering that percentage is what the corporation earns on its