Question.3041 - This is Straightforward assignment, conduct a financial analysis of Boston Scientific (BSX) and compare it to one of its competitors of your choice, and to the industry. Most of the ratios can be found on at www.reuters.com. Select Markets/Stocks and type in the ticker. If you need any financial statement information not available on Reuters, you will find it onwww.finance.yahoo.com. Enter the ticker symbol and then click on Income Statement or Balance Sheet under the Financials heading on the left for the financial statements themselves. You probably won’t be able to find Lease Payments or Debt Payments, so you don’t need to calculate the ratios that depend on those numbers. I would like a 2-page (and no longer, please!) writeup of your comparison. Since space is short, please don’t try to list the ratios and their differences. Rather, I’d like your qualitative assessment of BSX’s position relative to the industry and the competitor, with the ratios as supporting. You may have a table at the end listing the ratios if needed. You don’t need to define any of them. For example, here is a bad way to describe the two companies: “…Company X’s days sales outstanding ratio is 35 while Company Y’s DSO is 45. Company X’s times interest earned ratio is 2.7 while Company Y’s TIE is 1.2….” Rather, I’d like for you to decide what the ratios mean and use them to illustrate your point. Something like the following is better: “Company X is managing its supply chain better than Company Y and better than the industry. Company X’s inventory turnover is 15x per year while Company Y only manages 10x per year and the industry average is 11x. This efficiency is also reflected in Company X’s total asset turnover of 6x versus Company Y’s TATO of 5x and the industry average of 4x. …” So look over the ratios, draw some conclusions in your mind about the two companies and the industry, formulate carefully your thoughts, and then tell me about them.
Answer Below:
Ratio xxxxxxxxxx One xx the xxxxx competitors xx Boston xxxxxxxxxx Corporation xxx is xxxxxxx and xxxxxxx JNJ x Ratio xxxxxxxx of xxx with xxx and xxx industry xx done xxxxx Starting xxxx the xxxxxxxxx ratio xxxxxxx of xxxxxxx s xxxxx term xxxxxxxxx position xxx quick xxxxx considered xx the xxxx measure xxx liquidity xx BSX x e xxxxxx poor xx compared xx the xxxxxxxxxx JNJ xx well xx the xxxxxxxx Even xxx current xxxxx of xxx company xx lower xxxx the xxxxxxxxxx JNJ xxxxxx it xx close xx the xxxxxxxx This xxxxxxxxx indicates xxx company xxxx not xxxxx the xxxxxxxxx premium xx the xxxxxx and xx not xxxxxxx much xx cash xx the xxxxx or xx having xxxxx amounts xx accounts xxxxxxx in xxx accounts xx compared xx the xxxxxxxx Moving xxxxxxx to xxx profitability xxxxxx which xxxxxxxx the xxxxxxx s xxxxxxx to xxxxxxxx earnings xxxxxxxx to xxxxx assets xxx equity xx terms xx gross xxxxxx ratio xxx was xxxxxx to xxx competitor xxx but xxx better xxxx the xxxxxxxx standards xxxx indicates xxx company x ability xx get xxxxx at xxxxxx pricing xxxx their xxxxxxxx or xxxxxxx at xxxxxx timing xx a xxxxxx of xxxxx the xxxx of xxxxx sold xx lower xxx gross xxxxxx higher xxxxxxxxxxxxx the xxxxxxxxx profit xxxxxx OPM xx the xxx stands xxxxxxxxxxxx to xxx and xxxxxxxx as xxx OPM xx negative xxxxx that xx rest xx positive xxxx can xx due xx much xxxxxx selling xxx administrative xxxxxxxx research xxx development xxxxxxxx etc xxxxx resulted xxxx operating xxxx for xxx Looking xxx step xxxxxxx the xxxxxxxxx expenses xx BSX xxxxx at xx the xxxxxxxx whereas xxxx were xx of xxx revenue xxx JNJ xxxxxxxxxx from xxxxxx www xxxxx finance xxx BSX xxxxx to xxxxxxx its xxxxxxxx on xxx above xxxxxxxxx fronts xx a xxxxxx of xxx above xxxxxxxx the xxx profit xxxxxx of xxx - xx also xxxx negatives xxxxxxx about xxx efficiency xxxx of xxx company xxx revenue xxx employee xx BSX xxxxxx way xxxxx than xxx competitor xxx the xxxxxxxx This xxxxx again xxxxxxxx our xxxxxxxxxx drawn xxxxx that xxx company xxxxxxxx at xxxxxx overhead xxxxx as xxxxxxxx to xxxxxxxx It xxxxx more xxxxxx of xxxxxxxxx higher xxxxxxxxxxxxxx costs xx generate xxx similar xxxxxx of xxxxx to xxx industry xxx analysis xx further xxxxxxxxx by xxx low xxxxxxxxxx turnover xxxxxxxxx turnover xxx asset xxxxxxxx ratios xxx the xxxxx mentioned xxxxxx are xxxxx than xxx competitor xxx the xxxxxxxx except xx case xx receivable xxxxxxxx which xx higher xxxx the xxxxxxxx only xxx low xxxxxx imply xxx needs xx re-assess xxx credit xxxxxxxx in xxxxx to xxxxxx the xxxxxx collection xx imparted xxxxxx that xx not xxxxxxx interest xxx the xxxx The xxxxx inventory xxxxxxxxx also xxxxx that xxxxxxxx of xxx company xxxx to xxxx in xxx warehouse xxx longer xx compared xx industry xxxxxx looking xx the xxxx side xx the xxxxxxx the xxxxxxxx coverage xxxxx of xxx is xxxx lower xxxx JNJ xxx the xxxxxxxx This xxxxxxxxx its xxxxxxxxx to xxx its xxxxxxxx cost xx the xxxx borrowed xx s x point xx concern xx this xxxxx come xx a xxxxxxxxx when xxx company xxxxxxx plans xx raise xxxxx Below xx a xxxxx briefly xxxxxxxxxx the xxxxxx as xxxxxxxx to xxx and xxxxxxxx Ratio xxx JNJ xxxxxxxx Current xxxxx Interest xxxxxxxx Gross xxxxxx Operating xxxxxx - x Rev xxxxxxxx Receivable xxxxxxxxMore Articles From Finance
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