Question

I need a competitor ratio and analysis for Chipotle

Answer 1

Financial ratios provide business owners with a quantitative analysis of their company’s financial information. Business owners can also use financial ratios to create benchmarks for comparative analysis. A comparative analysis allows owners owners to compare their company’s financial ratio information to that of a competing company. This provides information on a competing company’s operational and financial performance. Financial ratio analysis also allows business owners to compare their company to businesses with dissimilar business operations.

Financial leverage ratios calculate the company’s long-term solvency. Business owners use these ratios to measure how well competitors are using debt and equity financing for business operations. The debt ratio and debt-to-equity ratio are the two most common financial leverage ratios.

The debt ratio is total debt divided by total assets. It provides business owners with information on how much debt financing competitors use to purchase business assets. The debt ratio is commonly calculated as a percentage; lower percentages indicate a company finances business operations through cash rather than debt.

The debt-to-equity ratio is total debt divided by total equity. This calculates how much of the business is financed through private investors or the business owners’ personal investments. It is also expressed in percentage form.