University:
Widener University
Course:
COMPSCI 345 | Practice and Applications of Data Management
Academic year:

2023
Views:

220

Pages:

11
Author:

uzletitef196x

Objectives and Game Plan • Become familiar with Intel’s financial statements and better understand information on the Balance Sheet • Ratio Analysis 2 Walking Through Intel’s Annual Report • CEO’s Letter • Financial Statements – Income Statement – Balance Sheet – SCF – SE – Notes • Auditor’s report • MD&A 3 ROE (Dupont) Analysis NI = NI + (int. exp.) SE Assets X Operating Performance “return on assets” “return on sales” NI NI + (int. exp.) X Assets SE Capital Structure “asset turnover” NI + (int. exp.) Sales X Assets Sales 4 ROE (Dupont) Analysis – Intel 2002 NI SE 3,117 + 84 (44,224 + 44,395)/2 0.087 = ROE 3,117 3,117 + 84 X 0.072 Common Equity Leverage ROA pre-interest ROS pre-interest X 1.243 Capital Structure Leverage 26,764 (44,224+44,395)/2 3,117 + 84 26,764 0.120 0.974 (44,224 + 44,395)/2 (35,468 + 35,830)/2 X 0.604 Asset Turnover 5 Return on Sales vs. Asset Turnover Sales Assets 4 3.5 Each point represents an industry 3 2.5 2 Semiconductors 1.5 1 NI + (int. exp.) Sales -3 -2.5 -2 -1.5 0.5 0 -1 -0.5 0 0.5 1 1.5 6 Return on Sales vs. Asset Turnover Excluding negative ROAs and Financal Institutions Sales Each point represents an Assets industry 4 3.5 3 2.5 2 1.5 NI + (int. exp.) Sales 1 0.5 0 0 0.05 0.1 0.15 0.2 0.25 0.3 0.35 0.4 7 Curves Showing Equal Return on Assets Sales Assets 4 3.5 Return on Assets 14% 8% 2% 3 2.5 2 1.5 NI + (int. exp.) Sales 1 0.5 0.39 0.36 0.33 0.30 0.27 0.24 0.21 0.18 0.15 0.12 0.09 0.06 0.03 0 8 Intel 1998 - 2002 1998 1999 2000 2001 2002 ROE ROA 0.270 0.260 0.301 0.035 0.087 0.202 0.195 0.230 0.029 0.072 Common Capital Equity Structure Leverage Leverage 0.993 0.994 0.996 0.955 0.974 1.344 1.339 1.312 1.262 1.243 ROS Sales over Assets 0.232 0.250 0.314 0.051 0.120 0.871 0.780 0.735 0.575 0.604 Data Source: Intel Corporation 9 Comparative ROEs ROE ROA Common Equity Leverage 2001 MICROSOFT 0.166 0.132 1.000 1.257 0.290 0.454 2001 STARBUCKS CORP 2001 IHOP CORP 0.144 0.141 0.108 0.102 1.000 0.656 1.325 2.103 0.068 0.189 1.584 0.539 2001 LILLY (ELI) & CO 0.423 0.192 0.929 2.367 0.259 0.742 2001 MERCK & CO 0.472 0.185 0.940 2.717 0.162 1.137 2001 PFIZER INC 0.453 0.223 0.960 2.114 0.253 0.883 2001 TIFFANY & CO 0.177 0.121 0.897 1.630 0.120 1.005 2001 LIMITED BRANDS 2001 TJX COMPANIES 0.205 0.391 0.126 0.166 0.939 0.925 1.740 2.551 0.059 0.051 2.126 3.281 2001 99 CENTS ONLY 0.169 0.154 0.998 1.098 0.084 1.837 CONAME Capital Structure Leverage ROS Sales over Assets 10 -10% 0% I 02 II 01 III 00 IV 99 I 99 II 98 III 97 IV 96 I 96 II 95 III 94 IV 93 I 93 II 92 40% III 91 II 92 20% III 90 IV 89 I 89 Gross Profit Percentage 60% 50% Compaq 30% Dell 10% -20% -30% 11 -10% 0% I 02 II 01 III 00 IV 99 I 99 II 98 III 97 IV 96 I 96 II 95 III 94 Compaq IV 93 50% I 93 Apple II 92 60% III 91 II 92 III 90 IV 89 30% I 89 Gross Profit Percentage 40% Dell 20% 10% -20% -30% 12