Financial Research Report: Lowe's Companies, Inc Essay

Financial ratio analysis is a valuable tool that allows one to assess the success, potential failure or future prospects of the company (Bazley 2012). The ratios are helpful in spotting useful trends that can indicate the warning signs of

You would not buy a home, car or other large purchases without researching what product offered you the most for your money. The same is true when investing in a company. Investors do avid research on multiple companies to find what company matches the investors' criteria. In this paper Team C will research both AT&T and Verizon's financial documents. Team C will compare selected ratios, cash flow and make recommendations how both companies can manage cash flow for the future.

Lowes is currently the second largest retailer by sales in the home improvement retail industry. It is also the 8th largest retailer in the United States and the 19th largest retailer in the world. The market cap for Lowes is currently $56.2 billion. Lowes’ stock price is currently (Dec 2) $63.83, just 31 cents off of its all time high from Nov 25. The company’s stock price has been volatile in nature since the turn of the decade in 2000. While it has been volatile, the general trend has been increasing steadily. Lowes’ stock did experience the drop in prices seen market wide during the recession in 2008 and 2009. Going from a high of $34.93 in February 2007, all the way down to $13.39 in March of 2009 (- 62%). Since September 2011 the stock price has shot up and experienced a 200% increase.

The purpose of this paper is to conduct a financial analysis of Lowe’s Companies, Inc. using financial ratios. The emphasis will be on examining ratios under the aforementioned categories and identifying trends in Lowe’s Companies, Inc. and comparing those findings with the industry averages. This paper will conclude with an assessment regarding the stability and future growth potential of Lowe’s Companies, Inc. in an ever changing economy.

Ratio analysis is a very useful tool when it comes to understanding the performance of the company. It highlights the strengths and the weaknesses of the company and pinpoints to the mangers and their subordinates as to which area of the company requires their attention be it prompt or gradual. The return on shareholder’s fund gives an estimate of the amount of profit available to be shared amongst the ordinary shareholders; where as the return on capital employed measures an organization 's profitability and the productivity with which its capital is utilized. Return on total assets is a profitability ratio that measures the net income created by total assets amid a period.

Lowes is currently the second largest retailer by sales in the home improvement retail industry. It is also the 8th largest retailer in the United States and the 19th largest retailer in the world. The market cap for Lowes is currently $56.2 billion. Lowes’ stock price is currently (Dec 2) $63.83, just 31 cents off of its all time high from Nov 25. The company’s stock price has been volatile in nature since the turn of the decade in 2000. While it has been volatile, the general trend has been increasing steadily. Lowes’ stock did experience the drop in prices seen market wide during the recession in 2008 and 2009. Going from a high of $34.93 in February 2007, all the way down to $13.39 in March of 2009 (- 62%). Since September 2011 the stock price has shot up and experienced a 200% increase.

Lowe’s Companies, Inc. is the fourteenth largest retailer in America, and overall the world’s second largest home improvement retailer. They are the 108th ranked corporation on the Fortune 500 top corporations list. With an impressive in store stock of 40,000 home improvement items on hand, ranging from lumber to Home décor items, plus an additional 400,000 home improvement items available through a special order program. Lowe’s provides a onetime stop for all home improvement needs, for both the Do-It-Yourselfer, and the ever-expanding market of the Commercial Business Customer.

Financial data from past periods of a company, provides a perspective for future outcomes. Investors give proper attention to different ratios. In this report I am analyzing the financial position and financial performance of AT & T, a US. Telecommunication Company. The objective and conclusion of this analysis will be, if is either good or not to invest in the company.

You would not buy a home, car or other large purchases without researching what product offered you the most for your money. The same is true when investing in a company. Investors do avid research on multiple companies to find what company matches the investors' criteria. In this paper Team C will research both AT&T and Verizon's financial documents. Team C will compare selected ratios, cash flow and make recommendations how both companies can manage cash flow for the future.

Investing in a company has certainly changed over the years. Financial information is literally at one's fingertips via the internet. In today's fast paced corporate environment companies are under tremendous scrutiny to maintain their edge. The company I am evaluating is NIKE. This Financial analysis will consist of the following: Ratios from the Income Statement, Statement of Owner's Equity, and Balance Sheet. This information is designed to assist a potential investor.

All managers need to understand where value comes from in their firm. The purpose of this analysis is to identify the financial strategy and performance of this particular publicly traded company. The process of understanding the risk and profitability of a company by analyzing reported financial info, especially annual and quarterly reports are vital to identifying the company’s overall financial performance. I wanted to analyze Coca Cola because the company has so much history and is one of the most recognizable brands in the world. I have always enjoyed researching food and beverage companies

Before beginning an analysis of a company it is necessary to have a complete set of financial statements, preferably for the pas few years so that historical trends can be obtained. Ratios are a way for anyone to get an idea of the financial performance of a company by using the information contained in the financial statements. Ratios are grouped into four basic categories, liquidity, activity, profitability, and financial leverage. This document will use a variety of these ratios to analyze the firm, Sample Company, as of December 31,2000.

Ratio analysis is generally used by the company to provide some information on how the company has performed during that year, so that the parties involved including shareholders, lenders, investors, government and other users could make some analysis before making any further decision towards that particular company. As mentioned by Gibson (1982a cited in British Accounting Review, 2002 pg. 290) where he believes that the use of ratio analysis is such an effective tool to evaluate the company’s finance, and to predict its future financial state. Ratios are simply divided in several categories; these are the profitability, liquidity, efficiency and gearing.

Five companies have been chosen in order to conduct research into the securities that they use within their company. The five companies are: Oracle, Disney, Cisco, Wal-mart and a general electric company. The companies chosen span over various industries starting with Oracle and Cisco which are technology companies, Disney which is in the movie industry, Wal-Mart which is a supermarket and lastly an electricity service industry company. This gives us a better view of how the securities change depending on not only the company but also the industry which they are involved in.

By writing this research better I will manage to gain a deeper understanding of the concepts of ratio analysis and the way they are beneficial to the organization’s stakeholders, such as investors, employees and management. The study will help me gain deeper understanding of the way in which to interpret