Financial Analysis Home Depot Research Paper

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Financial Analysis: Home Depot

Summary of Operations

Net Sales

Gross Margin

Operating Margin

Income before Taxes

Net Income

Financial Position

Working Capital

Property, Plant and Requirement

Total Assets

Long-Term Assets

Stockholders' Equity

Financial Ratio Analysis and Interpretation

Historical View of Financial Performance

Competitor and Industry Standards Comparison

The relevance of subjecting the financial statements of a company to intensive analysis cannot be overstated. This is more so the case given that the information obtained from such an analysis comes in handy in the determination of a company's financial health as well-being. In this text, I concern myself with the analysis of Home Depot's financial statements in an attempt to not only determine but also assess its financial performance and stability.

Summary of Operations

Net Sales

From the onset, it is important to note that with regard to net sales, Home Depot showed significant improvement throughout the three years under consideration. Between the financial years 2011 and 2012, the net sales figure increased from $67,997 million to $70,395 million. This essentially represents a 3.53% increase in the net sales figure. It is also important to note that between the financial years 2012 and 2013, the net income registered yet another increase of 6.19%.

Gross Margin The company's gross profit margin for the three years under consideration was 1.33, 1.55, and 1.

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34 for the years 2011, 2012, and 2013 respectively.

Operating Margin

When it comes to the company's operating margin, the same indicates that during the financial years 2011, 2012, and 2013, the company made a net profit of $0.10, $0.09, and $0.09 respectively on each sales dollar.

Income before Taxes

Next, we have income before taxes. The same increased by 15.08% and 19.00% between the years 2011-2012 and 2012-2013 respectively.

Net Income

Lastly, we have the net income. Like the net sales figure, the net income figure registered impressive growth within the three years under consideration. Between the years 2011 and 2012, the net income figure increased by 16.33%. Similarly, between the financial years 2012 and 2013, the net income figure increased by 16.79%.

Summary/Interpretation

The growth in the income figures in this case is impressive. If the company manages to contain its costs going forward, the increase in income will further enhance shareholders' value. When it comes to the gross margin, it is important to note that the same comes in handy in the determination of how much gross profit a business entity earns from the sale of goods and services. The company's gross profit margin in this case was largely stable, i.e. It.....

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Latest APA Format (6th edition)

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"Financial Analysis Home Depot" (2013, September 23) Retrieved July 6, 2024, from
https://www.aceyourpaper.com/essays/financial-analysis-home-depot-97001

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"Financial Analysis Home Depot" 23 September 2013. Web.6 July. 2024. <
https://www.aceyourpaper.com/essays/financial-analysis-home-depot-97001>

Latest Chicago Format (16th edition)

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"Financial Analysis Home Depot", 23 September 2013, Accessed.6 July. 2024,
https://www.aceyourpaper.com/essays/financial-analysis-home-depot-97001
   

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