Ford Motor Financial Ratio Analysis

A well formulated fiscal ratio epitome report helps investors to quantify a companys financial strengths and weaknesses and potential risks and opportunities and identify the companys financial position. development financial ratio analysis as a slit in conjunction with different clientele evaluation processes, and other company factors, is beneficial for the investors (Brealey, Meyers & Marcus, 2009). The following report will interpret the investor with a clear picture of the companys ongoing status as well as future undertaking in order to demonstrate investment opportunities. Specifically, this report examined thirty Companys financial ratios and other factors using a trim down table over the past five years. authorize on pluss (ROA) measures company earnings in relation to other resources much(prenominal)(prenominal) as shareholders capital plus suddenly and long-term bestows (Brealey et al., 2009). Return on assets also reports the profits a company generates for each dollar in assets and measures the intensity of the businesss assets. Specifically, lower per dollar profits results an increase of asset intensity for the company. Ford is asset intensive because this company mortgage its assets in 2006 in order to raise $24.5 zillion. Additionally, cash has been reinvested into the company, which has generated earnings.

In 2009 Ford also requested a one billion dollar line-of-credit from the government and a $5 billion loan from the Department of Energy in order to develop both hybrid and battery powered vehicles and retool plants to produce small cars. Compared to the industry index, Ford is 0.7% higher than the industry average in this area. In fact, Ford was in a better financial position than GM or Chrysler and did not need bailout money nor did Ford want their competitors to gain the upper hand (Ford Motor,2010) Return on equity measures a companys positiveness by revealing on the balance sheet how much profit a company generates using the money shareholders consume invested. A... If you want to get a full essay, order it on our website: Ordercustompaper.com

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