Assignment 1: Case Study Analysis: Martin Smith

Assignment 1: Case Study Analysis: Martin Smith

Company Analysis

There are three companies which are offering investment opportunities the main aim of this research is to undermine the strengths, weakness of the companies. This analysis helps the investors and users of financial statement to make a correct decision. Following are the companies:

Rustica Industries

Wildflower Corporation

Yellowstone Cattle Bank (YCB)

Business Summary & analysis of Rustica Industries

Rustica Industries manufactures and markets wire products (including bare, tin-plated, nickel-plated and silver-plated copper wire) for other wire suppliers, distributors and original equipment manufacturers. Co.'s products include a spectrum of copper wire configurations and gauges with a variety of electrical and conductive characteristics and are utilized by a variety of customers primarily in the aerospace, appliance, automotive, electronics and data communications, general industrial/energy and medical device industries. As of Dec 31 2008, Co. operated its business in the following three segments: Bare Wire; Engineered Wire Products - Europe; and High Performance Conductors.

Company Pricing Strategy

Time Period: 1 week

 

Yesterday

5 Days

30 Days

Close

16.60

19.00

18.80

Volume

N/A

N/A

2,068.00

52 Week High/Low :

N/A - N/A

% Price Change (100 Days) :

-10.27

200-Day Moving Avg. :

N/A

Key Financials

Income Statement

Revenue

533m

Net Income

-6m

EPS from Continuing Operations

-0.58

EPS - Net Income - Diluted

-0.59

Revenue per Share

53.40

Balance Sheet

Total Assets

340m

Total Liabilities

158m

Shareholders' Equity

182m

Total Assets per Share

34.04

Net Assets per Share

18.27

Cash Flows

Cash from Operations

64m

Cash from Investing

-43m

Cash from Financing

-21m

Capital Expenditures

10m

Cash Flow per Share

6.46

Companies Financial Standing

Income Statement

(In Thousands)

Total Revenue

736,402

EBITDA

37,280

Operating Income

22,153

Net Income

6,529

Revenue per Share

73.76

EPS from Continuing Operations

0.64

EPS - Net Income - Diluted

0.64

Share Outstanding

9,986

Weighted Average Shares Outstanding - Diluted

9,956

Weighted Average Shares Outstanding - Basic

10,225

Earnings per Share - Basic

0.66

Balance Sheet

(In Thousands)

Total Assets

370,099

Current Assets

161,794

Total Liabilities

188,495

Long Term Debt

87,792

Stockholders' Equity

181,604

Total Assets per Share

37.06

Current Liabilities

75,969

Net Assets per Share

18.19

Cash Flow Statement

(In Thousands)

Cash from Operations

60,816

Cash from Investing

(53,716)

Cash from Financing

(3,872)

Capital Expenditures

12,945

Cash Flow per Share

5.95

Cash & Cash Equivalents, Beginning of Year

3,991

Cash & Cash Equivalents, End of Year

7,372

Market Cap(mil)

166

Dividend Per Share(TTM)

1.08

High Price Last 3 Mos.

19.00

Low Price Last 3 Mos.

14.75

Avg Daily Volume Last 3 Mos.

4,847.03

Financial Ratios indicating the Financial Position

Management Effectiveness

Revenue per Employee

458,994

Net Income per Employee

4,069.00

ROA % (Net)

1.76

ROE % (Net)

3.53

ROI % (Operating)

8.03

Profitability Ratios

Gross Margin

11.63

Operating Margin

3.01

EBITDA Margin %

5.06

Calculated Tax Rate %

43.72

Profit Margin (TTM)

0.89

Valuation Ratios

Price/Earnings (TTM)

15.19

Price/Book (TTM)

0.55

Price/Cash Flow(TTM)

1.64

Asset Management

Total Asset Turnover

1.99

Receivables Turnover

9.19

Inventory Turnover

10.85

Property Plant & Equip Turnover

6.67

Cash & Equivalents Turnover

129.26

Debt Management

Interest Coverage

2.19

Long Term Debt/Equity

0.48

Long Term Debt as % of Invested Capital

32.52

Total Debt/Equity

0.49

Accounts Payable Turnover

28.82

Accrued Expenses Turnover

31.21

Liquidity Indicators

Quick Ratio

0.87

Current Ratio

2.13

Net Current Assets as % of Total Assets

23.19

Free Cash Flow per Share

4.82

Revenue to Assets

1.99

Business Analysis

The company is doing well on the financial charts, the financial ratios indicates that the market is going smooth in the wire business. The company also has planned to establish its sight in different countries, so as to lower down the cost structure and in result it boosts up the profits. The major strength of the company is that how much its stakeholders have trust on the company. The financial standing of the company highlights that the behavior of investors is moderate towards investing in Rustica Industries, there are chances of doing it better. Glimpse of the financial are given below:

Revenues

Report Date

12/31/2008

12/31/2007

12/31/2006

Currency

USD

USD

USD

Scale

Thousands

Thousands

Thousands

Bare Wire

530,789

543,231

611,356

Engineered Wire Products - Europe

72,544

67,408

55,151

Insulated Wire

-

-

-

High Performance Conductors

135,145

122,234

82,980

Business Summary & Analysis of Yellowstone Cattle Bank

Yellowstone Cattle Bank (YCB) Industries provides ...