Question

Please answer all question using a full paragraph, watch you grammar and syntax.

a. What is trend in investor ratios of Walgreens - use ratios in the answer? (please use at least three sentences.

b. What is trend in investors ratios of CVS - use ratios in the answer? (please use at least three sentences)

c. Which company has had the better investor ration over the last the years - explain using ratios? ( please use at least three sentences)

CVS

Balance Sheet

All numbers in thousands

Period Ending	12/31/2017	12/31/2016	12/31/2015
Current Assets
Cash And Cash Equivalents	1,696,000	3,371,000	2,459,000
Short Term Investments	111,000	87,000	88,000
Net Receivables	13,181,000	12,164,000	11,888,000
Inventory	15,296,000	14,760,000	14,001,000
Other Current Assets	945,000	660,000	722,000
Total Current Assets	31,229,000	31,042,000	29,158,000
Long Term Investments	-	-	-
Property Plant and Equipment	10,292,000	10,175,000	9,855,000
Goodwill	38,451,000	38,249,000	38,106,000
Intangible Assets	13,630,000	13,511,000	13,878,000
Accumulated Amortization	-	-	-
Other Assets	1,529,000	1,485,000	1,440,000
Deferred Long Term Asset Charges	-	-	-
Total Assets	95,131,000	94,462,000	92,437,000
Current Liabilities
Accounts Payable	15,472,000	14,883,000	14,319,000
Short/Current Long Term Debt	15,176,000	11,367,000	8,850,000
Other Current Liabilities	-	-	-
Total Current Liabilities	30,648,000	26,250,000	23,169,000
Long Term Debt	22,181,000	25,615,000	26,267,000
Other Liabilities	1,611,000	1,549,000	1,542,000
Deferred Long Term Liability Charges	2,996,000	4,214,000	4,217,000
Minority Interest	4,000	4,000	7,000
Negative Goodwill	-	-	-
Total Liabilities	57,440,000	57,632,000	55,202,000
Stockholders' Equity
Misc. Stocks Options Warrants	-	-	39,000
Redeemable Preferred Stock	-	-	-
Preferred Stock	-	-	-
Common Stock	17,000	17,000	17,000
Retained Earnings	43,556,000	38,983,000	35,506,000
Treasury Stock	-37,765,000	-33,452,000	-28,886,000
Capital Surplus	32,079,000	31,618,000	30,948,000
Other Stockholder Equity	-196,000	-336,000	-389,000
Total Stockholder Equity	37,691,000	36,830,000	37,196,000
Net Tangible Assets	-14,390,000	-14,930,000	-14,788,000

Walgreens

Income Statement

All numbers in thousands

Revenue	8/31/2017	8/31/2016	8/31/2015
Total Revenue	118,214,000	117,351,000	103,444,000
Cost of Revenue	89,052,000	87,477,000	76,691,000
Gross Profit	29,162,000	29,874,000	26,753,000
Operating Expenses
Research Development	-	-	-
Selling General and Administrative	23,605,000	23,873,000	22,085,000
Non Recurring	-	-	-
Others	-	-	-
Total Operating Expenses	-	-	-
Operating Income or Loss	5,557,000	6,001,000	4,668,000
Income from Continuing Operations
Total Other Income/Expenses Net	-11,000	-261,000	1,248,000
Earnings Before Interest and Taxes	5,546,000	5,740,000	5,916,000
Interest Expense	693,000	596,000	605,000
Income Before Tax	4,853,000	5,144,000	5,311,000
Income Tax Expense	752,000	953,000	1,032,000
Minority Interest	808,000	401,000	439,000
Net Income From Continuing Ops	4,078,000	4,173,000	4,220,000
Non-recurring Events
Discontinued Operations	-	-	-
Extraordinary Items	-	-	-
Effect Of Accounting Changes	-	-	-
Other Items	-	-	-
Net Income
Net Income	4,078,000	4,173,000	4,220,000
Preferred Stock And Other Adjustments	-	-	-
Net Income Applicable To Common Shares	4,078,000	4,173,000	4,220,000

Answer 1

Solution:

a) The trend in investor ratio of Walgreen are as follows:

The profit margin ratio (net profit/total revenue*100) in three years are in 2017 it is 3.45%, in 2016 the same is 3.56% and in 2015 it is 4.08%. The trend of the profit margin ratio is decreasing.

b) The trend in investor ratio of CVS are as follows

The current ratio (total current assets/total current liabilities) in three years are in 2017 it is 1.02 times, in 2016 the same is 1.18 times and in 2015 it is 1.26 times. The trend of the current ratio is decreasing. The current ratio helps to determine the liquidity of the business.

c) The CVS company has had better investors ratios in compare with Walgreen. The Wallgreen company’s net income is decreasing which represents that the performance of the business is not efficient and not manage properly. In other hand the liquidity ratio of the CVS also decreased but it is more than 1. The ideal current ratio is 2:1. So it can be said that the performance of the CVS is better in compare with Wallgreen is aspect of investor ratios.