Using the information in the table below, answer calculate the following: Which company demonstrates the worst leverage ratio? Explain what it depicts. Which company demonstrates the strongest interest coverage ratio? Explain what it depicts. Walmart Inc Target Corp
Using the information in the table below, answer calculate the following: Which company demonstrates the worst leverage ratio? Explain what it depicts. Which company demonstrates the strongest interest coverage ratio? Explain what it depicts. Walmart Inc Target Corp
Survey of Accounting (Accounting I)
8th Edition
ISBN:9781305961883
Author:Carl Warren
Publisher:Carl Warren
Chapter12: Differential Analysis And Product Pricing
Section: Chapter Questions
Problem 12.4E
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Question
. Using the information in the table below, answer calculate the following:
- Which company demonstrates the worst leverage ratio? Explain what it depicts.
- Which company demonstrates the strongest interest coverage ratio? Explain what it depicts.
Walmart Inc | Target Corp | Home Depot Inc/The | Lowe's Cos Inc | CVS Health Corp | |
2020 Q2 | 2020 Q2 | 2020 Q2 | 2020 Q2 | 2020 Q2 | |
Revenue | 518 | 76.8 | 110 | 71.8 | 226.8 |
EBI TDA | 33.7 | 7 | 18.3 | 6.1 | 14.2 |
EBI TDA Margin | 6% | 9% | 17% | 8% | 6% |
Net Income | 12.8 | 3.2 | 11.2 | 2.5 | 4.3 |
Return on Capital | 11.1 | 14.1 | 39.6 | 13 | 4.9 |
Credit Metrics(x) | |||||
Debt/EBI TDA | 2 | 1.9 | 1.8 | 3.4 | 5.9 |
EBI TDA/Interest | 14 | 16.2 | 18.7 | 16 | 6.6 |
FCF Coverage | 7.7 | 14.6 | 11.1 | 6.2 | 6.2 |
0.3 | 0.2 | 0.3 | 0.2 | 0.1 |
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