Financial Statment for Wal-Mart Stores Inc.

1654 words 7 pages
Comparing the financial performance between Wal-Mart and Amazon by the metrics :

Return on Equity Ratio(ROE):
This ratio demonstrates how efficiently the business is utilizing and deploying the equity, either invested in the business or generated by the business, to generate profits.
ROE= Net income/ avg shahloder equity

ROE in Wal-Mart stores is: 2.726840403
A ration of 272.6% would show the business is earning $2.73 in pretax or operating profit for each $1of equity employed in the business
ROE in Amazon is: 0.171580749(2009)
A ration of 17.2% would show the business is earning $0.172 in pretax or operating profit for each $1 of equity employed in the business

It shows the percentage of profits earned for each dollar of equity in
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The Inventory Turnover Ratio shows the number of times the business's inventory is depleted and needs to be replaced during the period in question. The lower the number, the better for the business as it is turning over inventory into sales (the goal) as fast as possible. A Amazon is better than Wal-Mart.

Profit margin:

Indicator of profitability, and it is a way of measuring how well a company is doing, regardless of size. Determined by dividing net income by revenue for the same period. Result is shown as a percentage.

Profit margin =Earning before intrest / Sales revenue

Profit margin in Wal-Mart: 0.037448893

It means that the company keeps in earnings .0374 of every dollar of sales

Profit margin in Amazon : 0.037708231.
It means that the company keeps in earnings .0377 of every dollar of sales

Profit margin is an excellent indicator of a firm's operating efficiency, its pricing policies, and its ability to remain competitive. The higher the profit margin is, the better the company is thought to control costs. So Amazon is better than Wal-Mart in a very small different .

Property, Plant, and Equipment Turnover

This ratio tells you how many dollars of sales your company gets for each dollar invested in property, plant, and equipment (PPE). It’s a measure of how efficient you are at generating revenue from fixed assets such as buildings, vehicles, and machinery. The higher our PPE Turnover,

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