Financial Detective Essay

Health Products come with A is Johnson & Johnson, which is a diversified manufacturer of prescription pharmaceuticals, health and beauty aids, over-the-counter(prenominal) drugs, and medical devices. community B is Pfizer Inc., which develops, manufactures, and markets patented pharmaceuticals much(prenominal) as Liptor and Celebrex. The most(prenominal) significant strategic differences mingled with the 2 firms lie in their result mix and their customer focus. J&J administers most of its products directly to the consumer eon Pfizer sells exclusively to doctors and institutions. trusty B has intangibles worth more(prenominal) than in two ways as some(prenominal) as firm A, which may echo firms Bs high investment in R&D. Firm B may also acquit high intangibles repayable to their will power of patents and its investments in licensing arrangements.Firm Bs gross margin is more than 12% high than lodge As, which bounds the high input cost for bon ton As medical di agnostics and devices product segment.troupe A has a far quicker account derangement than connection B. conjunction B sells close exclusively to institutions and pharmacies, which usu completelyy take lifelong to exhaust their supplies comp atomic number 18d to party A, who markets its consumer products to retailers, which have a higher turnover orientations.many of telephoner As and Bs products argon brand consumer products that command a price agio. However, familiarity Bs premium is higher, reflecting the benefits of patent protection on prescription pharmaceuticals, and the additional returns needed to accommodate bon ton Bs big(a) R&D efforts.Beer phoner C is Anheuser-Busch Companies Inc., which is a producer and marketer of a number of mass-market beers such as Budweiser, Michelob, and Busch. lodge D is the Boston Beer troupe, which is the seller of the popular surface-to-air missileAdams line of beers. Boston beers products are part of a microbrew. familiarity D s simile of cash and cash equivalents, which is extremely higher than social club Cs show their conservative sexual climax to its pecuniary management. political party C shows a relatively high aim of PP&E, which is consonant with its status as a major brewery. Company D has much first gearer lowest headstrong additions since much of their operations are outsourced. Company C also has higher fixed summations due to its other(a) holdings such as theme parks.Company D has higher gross pelf, agreeable with the premium determine of its specialty brews versus the mass-marketing approach that was taken by company C. However, company Cs net profit margin is almost common chord times greater than company Ds. This may reflect the economies of scale that company C can achieve through its bad size.Company Ds current assets to current liabilities ratio is three times greater than company Cs, whose current ratio is slight than one. That is illustrating a careful financial appro ach.The commitment to financially conservative policies is shown with company Ds relatively low level of debt.Company Cs mass-market approach shows a significantly higher strain turnover than company Ds turnover.Company Ds asset turnover is much higher due to the outsourcing. Company Cs turn away turnover is consistent with a firm that owns its manufacturing facilities as soundly as asset-intensive theme parks.ComputersCompany E is Dell Inc., a ecumenic manufacturer and direct marketer of built-to-order computers and related equipment. Company F is apple ComputerInc., a manufacturer of a highly differentiated assembly of personal computers, packet, and consumer electronics. This is motivated by the differentiation where company E seeks to sell a relatively high volume of lower-margin products, while company F attempts to sell an adequate volume of higher margin products.The computer and software industry is extremely volatile, which company F has experienced. Company F has ex tremely whopping holdings of cash and cash equivalents, which may represent their efforts to insure the company against any future difficulties.Company E has a higher parcel of A/P, which may reflect a higher degree of provider financing.Company F has a lower COGS section, which reflects both its premium pricing and the lower cost associated with software production. Company Es COGS is higher due to its strategy of making money on volume quite a than from individual product margins.Company F has higher gross profit than company E due to its premium pricing. However, Company Es net profit margin is almost twice as large as company Fs, which reflects their low-cost focus.Company E has low cost mail-order strategy, which leads to a lower SG&A percentage compared to company Fs who goes with a more unique retail store concept.Company F has a higher receivables turnover, which reflects the fast payments made by consumers in the form of credit card purchasers.Company Es asset turnover is more than twice as large as company Fs. This might reflect Es strategy as an assembler of components that have been manufactured by its supplier.Books and MusicCompany G is Amazon.com, the online retailer of books and music plus a variety of other consumer goods. Company H is Barnes & Noble, Inc., the largest bookseller in the United States. The main difference between the two is that one cosmos an established, traditional retailer and the other existence a relatively new online business.Company G has more than half of its assets in cash and cash equivalents, which could be explained by its carefulness in a volatile online retail business.Company H has significantly higher proportion of caudex than company G because they have to take hold stocks of books, CDs, and videos at all of its stores, whereas company G can keep limited inventory at its distribution centers.Company G obviously has a significantly lower net fixed asset due to being an online retailer compared to having bigeminal stores to sell its merchandise.More than half of company Gs percentage of total liabilities and equity is comprised of long-term debt. This is most likely due to its issues of being able to raise capital after the dot-com bust environment.Company Gs beta is more than three times higher than company Hs, which shows a relatively higher risk of company G. Company G just recently started to show positive net income.Company G is able to keep a higher inventory turnover since they dont have to sit with a luck of inventory on hand at all times compared to company H who has to store its inventory in their store, which lowers their turnover.Company H has a regular discount strategy, which could explain their lower net profit margin. newsprint ProductsCompany I is the International Paper Company, a large, vertically interconnected paper products manufacturer. Company J is the Wausau paper Paper Corporation, a small, specialty-papers operation. The distinctions between the firms a rise primarily from their scale and scope.Company J carries more than twice the rate of company I, which may be the case due to its little size it requires the firm to carry a higher proportion of inventory in order to satisfy its demanding customers.Company I has a textile lower percentage of COGS than company J, even though the raw materials are essentially the same. This illustrates the benefits of Company I having its own forests and lumber operations and their cogency to pull off lower volume-prices.Company Is SG&A expenses are higher than Js, which probably reflect the higher costs associated with being a large company.Hardware and ToolsCompany K is Black and Decker Corporation, which manufactures and markets a broad range of power tools. Company L is Snap-on Inc., also a manufacturer of tools and other hardware, but the company is known for its high fiber merchandise and for its direct sales to professional mechanics and commercial technicians.Company L has a higher perc entage of receivables compared to Ks. This result occurs because K markets directly to professional end-users and provides financing, which may cause delays in repayment. On the other hand, company L primarily sells its merchandise to large retailers, which may have more regular payment schedules.Company K sells lower-priced products intended for the consumer market, whereas company L markets higher margin precision tools for the commercial customer. Therefore, Company Ls gross profit percentage is measurablehigher than Ks.Company L has a higher SG&A expenses, which corresponds to the costs associated with maintaining its large direct sales force.Company Ls payout ratio is more than four-and-a-half times greater than Ks, which may suggest its need to maintain a high rate of reinvestment to remain competitive.RetailingCompany M is Wal-Mart Stores Inc., which is well known for the breadth of its merchandise and its low price strategy. Company N is Target Corporation, which also is a d iscount retailer, however signal appeals to its customers more upscale tastes.Company N has much higher receivables than M, reflecting Ns substantial credit activities.Company M has higher inventory levels relative to N, which may reflect the companys commitment to providing a vast selection of goods.Company N has relatively lower COGS percentage, reflecting its brimful price for designer-made products. M offers low prices, which would result in a higher COGS percentage.Company M has a higher receivable turnover due to its lower use of credit sales. impertinentspapersCompany O is Lee Enterprises, the owner of a number of small newspapers in the Midwest. Company P is New York Times Company, and their strategic difference between the two entities is along the centralisation/decentralization dimension. Company P has a centralizedstrategic approach while company O has a decentralized approach.Company P, who has a centralized approach, has a significantly higher level of net fixed ass ets than O.K bears some of the features of a decentralized operation, since its intangibles comprise almost 77% of total assets, which suggests the existence of substantial goodwill.Company Ps level of COGS is lower than Os, which suggests that as a bigger centralized company, P may be in a better position to negotiate for volume discounts than O.Although O is decentralized, the case shows that they have slightly lower SG&A expenses than P. One example to this could be that high prices may be screen a relatively high SG&A expense.Company Os P/E ratio is higher than Ps, which may taper the expectations of growth for O. As the dominant player on a larger scale, P may be unable to grow through strategic acquisition.Os net profit margin is higher, which may reflect the local monopolies, or at least less intense rivalry outside of the major metropolitan newspaper markets.