Analyze the financials for Wal-Mart and its competitor(s) in the online market in 2012 and 2016. What do you conclude from analyzing financial ratios about the companies strategies and Walmart's competitive advantage? Revenue Cost of goods sold Gross profit SG&A and other expenses Operating income Net income Total assets Total liabilities Total equity Total assets end Total assets beginning Total liabilities end Total liabilities beginning Total equity end Total equity beginning Cost of goods sold as % of sales Gross margin SG&A as % of sales Operating income margin Net profit margin Asset turnover ROA ROE Walmart 2012 in $ millions 443,854 335,127 108,727 85,265 23,462 15,699 186,931 113,021 73,910 193,406 180,455 117,241 108,800 76,165 71,655 75.5% 24.5% 19.2% 5.3% 3.5% 2.4 8.4% 21.2% Walmart 2016 in $ millions 478,614 360,984 117,630 97,041 20,589 14,694 201,536 116,762 84,774 199,581 203,490 115,970 117,553 83,611 85,937 75.4% 24.6% 20.3% 4.3% 3.1% 2.4 7.3% 17.3% Amazon 2012 in $ millions 61,093 45,971 15,122 14,287 835 (39) 28,903 20,928 7,975 32,555 25,250 24,363 17,493 8,192 7,757 75.2% 24.8% 23.4% 1.4% -0.1% 2.1 -0.1% -0.5% Amazon 2016 in $ millions 135,987 88,265 47,722 43,369 4,353 2,371 74,075 57,740 16,335 83,402 64,747 64,117 51,363 19,285 13,384 64.9% 35.1% 31.9% 3.2% 1.7% 1.8 3.2% 14.5%
Analyze the financials for Wal-Mart and its competitor(s) in the online market in 2012 and 2016. What do you conclude from analyzing financial ratios about the companies strategies and Walmart's competitive advantage? Revenue Cost of goods sold Gross profit SG&A and other expenses Operating income Net income Total assets Total liabilities Total equity Total assets end Total assets beginning Total liabilities end Total liabilities beginning Total equity end Total equity beginning Cost of goods sold as % of sales Gross margin SG&A as % of sales Operating income margin Net profit margin Asset turnover ROA ROE Walmart 2012 in $ millions 443,854 335,127 108,727 85,265 23,462 15,699 186,931 113,021 73,910 193,406 180,455 117,241 108,800 76,165 71,655 75.5% 24.5% 19.2% 5.3% 3.5% 2.4 8.4% 21.2% Walmart 2016 in $ millions 478,614 360,984 117,630 97,041 20,589 14,694 201,536 116,762 84,774 199,581 203,490 115,970 117,553 83,611 85,937 75.4% 24.6% 20.3% 4.3% 3.1% 2.4 7.3% 17.3% Amazon 2012 in $ millions 61,093 45,971 15,122 14,287 835 (39) 28,903 20,928 7,975 32,555 25,250 24,363 17,493 8,192 7,757 75.2% 24.8% 23.4% 1.4% -0.1% 2.1 -0.1% -0.5% Amazon 2016 in $ millions 135,987 88,265 47,722 43,369 4,353 2,371 74,075 57,740 16,335 83,402 64,747 64,117 51,363 19,285 13,384 64.9% 35.1% 31.9% 3.2% 1.7% 1.8 3.2% 14.5%
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
Problem 1PS
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Transcribed Image Text:**Financial Analysis of Walmart and Amazon (2012 vs. 2016)**
This financial comparison provides an analysis of Walmart and its competitor Amazon's performance in the online market for the years 2012 and 2016. The data is presented in a tabular format for the following variables:
### Financial Data (in $ millions)
- **Revenue:**
- Walmart: $443,854 (2012), $478,614 (2016)
- Amazon: $61,093 (2012), $135,987 (2016)
- **Cost of Goods Sold:**
- Walmart: $335,127 (2012), $360,984 (2016)
- Amazon: $45,971 (2012), $88,265 (2016)
- **Gross Profit:**
- Walmart: $108,727 (2012), $117,630 (2016)
- Amazon: $15,122 (2012), $47,722 (2016)
- **SG&A and Other Expenses:**
- Walmart: $85,265 (2012), $97,041 (2016)
- Amazon: $14,287 (2012), $43,369 (2016)
- **Operating Income:**
- Walmart: $23,462 (2012), $20,589 (2016)
- Amazon: $835 (2012), $4,353 (2016)
- **Net Income:**
- Walmart: $15,699 (2012), $14,694 (2016)
- Amazon: -$39 (2012), $2,371 (2016)
### Balance Sheet Data
- **Total Assets:**
- Walmart: $186,931 (2012), $201,536 (2016)
- Amazon: $28,903 (2012), $74,075 (2016)
- **Total Liabilities:**
- Walmart: $113,021 (2012), $116,762 (2016)
- Amazon: $20,928 (2012), $57,740 (2016)
- **Total Equity:**
- Walmart: $73,910 (2012), $84,774 (2016)
- Amazon: $7,975 (2012), $16,335 (2016)
###
Expert Solution
Step 1
Analysis of top line growth:
| Description | Walmart | Amazon | ||||
| 2012 | 2016 | % change | 2012 | 2016 | % change | |
| in $ millions | in $ millions | in $ millions | in $ millions | |||
| Revenue | 443854 | 478614 | 7.83% | 61093 | 135987 | 122.59% |
Top line growth of Walmart is only 7.83%, whereas top line growth of Amazon is 122.59% during the same period 2012 and 2016.
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