Financial Ratio Analysis of Microsoft

CASH FLOW STATEMENT ANALYSISOver three long time, net notes from operations has exceeded net income creating to a greater extent than enough notes to coer describe depreciation amounts and normal public stock specie dividends. This indicates that Microsoft burn support its cash needs with its operations and points to wherefore the conjunction does not rely on borrowing. Account receivables increase two-fold each year, which indicates potential future growth. Also, deduction trends in permit assets and liabilities demonstrate sustained increases in operating(a) assets and decreases in operating liabilities. communication channel repurchase has been more than than doubled since 2004. This could possibly be because of undervaluation issues or an effort to boost Microsoft?s P/E ratio. The jumbo net decrease in cash in 2005 usher out be entirely attributed to the abnormal jump in common stock cash dividends that year. In ?05, Microsoft paid 1400% more in dividends than t he yearly average. There is no new(prenominal) epoch-making decrease in any other item for ?05 on the cash fertilise statement. Since ?04, Microsoft has steadily increased acquisition of other companies, which is typical of companies as large as Microsoft. This is also a good index number of future growth. Microsoft?s purchase of come outments has declined over the three years whereas the sale of investments has re primary(prenominal)ed relatively stable. In ?06, they sell more investments than they bought.

This may mean the society has less cash to invest because of losses or the money is being utilize elsewhere, much(prenominal) as stock dividends. COMPETITORSAdobe, Oracle, a nd CA, Inc. be Microsoft?s main competitors! . These companies are the biggest ones in the software application industry of applied experience sector. 1. earnability Ratios profit margin and ROIC are two ratios that relate the earnings of the telephoner to capital that has been sacrificed for more than the company?s operating cycle. Profit margin is a measurement that portrays the effects... If you want to get a full essay, order it on our website: OrderEssay.net

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