Online Finance Assignment Help Examples: How to do Company Ratio Analysis?


The example is explained with the help of profitability and marketing ratio analysis of Chevron and Exon.

Profitability Analysis

The profitability analysis for both Chevron (CHV) and Exon (EXN) will be done with the help  of various profitability ratios as given below. It is done by our online finance assignment help experts to help you understanding how to do ratio analysis interpretation of two companies:-

Profitability Ratio:- Chevron
Year
2013
2012
Gross Profit
35.03%
35.49%
Operating Profit
12.59%
17.12%
Net Profit
9.73%
11.35%

Profitability Ratio:- Exon
Year
2013
2012
Gross Profit
25.08%
25.92%
Operating Profit
9.58%
11.05%
Net Profit
7.74%
9.94%

In order to do analysis, one will calculate different profitability ratios as shown above using their formulas in excel. Then it is interpreted using various tools like trend graph etc. In this example, the profitability ratio clearly shows that it is in decreasing trend for both companies. However, it is higher for EXN due to higher revenues; lower cost of goods sold and also lowers selling and administrative costs.

Market Ratio Analysis 

The Market analysis for both Chevron (CHV) and Exon (EXN) will be done with the help  of Market performance ratios as given below:-
Market Performance Ratio:- Chevron
Year
2013
2012
P/E
                         10.89
               7.79
P/S
                           1.04
               0.89

Market Performance Ratio:- Exon
Year
2013
2012
P/E
                         11.51
               9.76
P/S
                           0.89
               0.97


As per analysis done by our financial accounting assignment help experts, the market ratio ratio clearly shows that P/E ratio is in increasing trend for both companies. However, it is higher for EXN due to greater share price due to large interest shown by the investors. Besides P/S ratio is in increasing trend for Chevron whereas it is in decreasing trend for Exon because of decreasing sales for Chevron which in turn decreases the P/S ratio.

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