| (in millions, except per share data) |
| | | Microsoft | | | Oracle | | | Interpretation and comparison between the two companies' ratios |
| Profitability Ratios |
| Gross Profit Margin | Gross profit | $54,358 | = | 77.7% | $24,789 | = | 69.6% | The gross profit for Microsoft is 77.75% while Oracle is 69.6% |
| | Sales | $69,943 | | | $35,622 | | | Microsoft sells many types of products |
| Operating Margin | Operating Income | 27,161 | = | 38.8% | 12,033 | = | 33.8% |
| | Sales | $69,943 | | | $35,622 |
| Net Profit Margin | Net Income | $ 23,150 | = | 24.0% | $ 8,547 | = | 24.0% |
| | Sales | $69,943 | | | $35,622 |
| Liquidity Ratio |
| Current Ratio | Current assets | 74,918 | = | 2.60 | $39,174 | = | 2.76 | Oracle has a greater liquidity |
| | Current liabilities | 28,774 | | | $14,192 | | | Microsoft has 2.6 in current assets for every $1 in current liabilities |
| | | | | | | | | Oracle has 2.76 in current assets for every dollar in current liabilities |
| Quick Ratio | + Accounts Receivable | | = | 0.0% | | = |
| | Current Liabilities | 28,774 | | | $14,192 |
| Cash Ratio | Cash | | = | 0.0% | | = |
| | Current Liabilities | 28,774 | | | $14,192 |
| Working Capital Ratios |
| Accounts Receivable Turnover | Acoounts Receivable | $7,637 | = | 0.5 | $15,120 | = | 2.5 | Oracle has a higher account receivable turnover |
| | Average Daily Sales | $14,001 | | | $6,107 |
| Inventory Days | Inventory | $ 303 | = | ERROR:#DIV/0! | (561) | = | ERROR:#DIV/0! | Oracle has a higher turnover because it doesn’t hold inventory |
| | Average Daily Cost of Sales | | | times | | | Days | (1,125) |
| Accounts Payable Days | Accounts Payable | $ 4,197 | = | ERROR:#DIV/0! | 701 | = | ERROR:#DIV/0! |
| | Average Daily Cost of Sales |
| Interest Coverage Ratios |
| EBIT/Interest Coverage | EBIT | | = | 0.0% | | = | 0.0% |
| | Interest Expense | (295) | | | (808) |
| EBITDA/Interest Coverage | EBITDA | | = | 0.0% | | = | 0.0% |
| | Interest Expense | (295) | | | (808) |
| Leverage Ratios |
| Debt to Capital/ Asset Ratio | Total Debt | $ 48,825 | = | 46.1% | 13,875 | = | 25.6% |
| | Total Equity + Total Debt | $105,908 | | | $54,120 |
| | | | = | ERROR:#DIV/0! | | = | ERROR:#DIV/0! | Feel free to choose any of the formulas from the next page in leverage ratios |
| | | | = | ERROR:#DIV/0! | | = | ERROR:#DIV/0! |
| Valuation Ratios |
| Market to Book Ratio | Market Value of Equity | | = | ERROR:#DIV/0! | | = | ERROR:#DIV/0! |
| | Book Value of Equity |
| Price Earnings Ratio | Sahre Price | | = | ERROR:#DIV/0! | | = | ERROR:#DIV/0! |
| | Earnings per Share |
| Enterprise Value Ratios | Enterprise Value | | = | ERROR:#DIV/0! | | = | ERROR:#DIV/0! |
| | EBIT or EBITDA or Sales |
| Operating Returns |
| Asset turnover | Net Sales | $69,943 | = | 0.46 | $35,622 | = | 0.53 | Microsoft uses its asset inorder to make revenue |
| | Average Total Assets | $151,761 | | | $67,557 |
| | | | = | ERROR:#DIV/0! | | = | ERROR:#DIV/0! |
| | | | | | | | | Feel free to choose any of the formulas from the next page in operating returns |
| | | | = | ERROR:#DIV/0! | | = | ERROR:#DIV/0! |
reneegg1990
hw_market.xlsx
