Perform an expanded analysis on the financial statements for Cameron Internation

Question

Perform an expanded analysis on the financial statements for Cameron International (CAM). Use the most current 10K statements available on SEC or annual statements in Yahoo Finance. Complete the following for your chosen firm in an Excel spreadsheet: Horizontal and vertical analysis of the income statements for the past three years (all yearly balances set as a percentage of total revenues for that year). Horizontal and vertical analysis of the balance sheets for the past three years (all yearly balances set as a percentage of total assets for that year). Ratio analysis (eight ratios of your choosing) for the past three years PLUS a measurement for the creditworthiness of your firm as measured by Altman’s Z-score. Note that if you used your chosen firm for our ratio-related discussion posts, then you MUST also present industry-average ratios or current year competitor ratios for your ratio analysis. Comparing your firm’s ratios to a close competitor or an industry-average ratio makes your analysis much more meaningful.

Income Statement (numbers in thousands)

Income Statement

Balance Sheet

Cash Flow

Explanation / Answer

Ans:

Gross profit ratio:

2013 = Gross profit / Net sales * 100

         = $2,620,000 /$ 9,138,000 * 100

         = 28.67%

2014 = $2,917,000 / $10,381,000 * 100

         = 28.09%

2015 = $2,656,000 / 8,782,000 * 100

         = 30.24%

Operating profit ratio:

        = operating profit / Net sales * 100

2013 = $1,047,000 / $ 9,138,000 * 100

         = 11.45%

2014 = $1,238,000 / $10,381,000 * 100

         = 11.9%

2015 = $593,000 / $8,782,000 * 100

         = 6.75%

Net profit ratio:

= Net profit / Net sales *100

2013 = $699,000 / $ 9,138,000 * 100

         = 7.64%

2014 = $811,000 / $10,381,000 * 100

         = 7.81%

2015 = $501,000 / $8,782,000 * 100

         = 5.70%

Fixed assets turnover ratio:

2013 = $6,518,000 / $6,080,000

         = 1.07%

2014 = $7,464,000 / $5,340,000

         = 1.39%

2015 = $2,656,000 / $4,382,000

         = 0.60%

Current assets ratio:

Current assets /current liabilities

2013 = $8,169,000 / $4,260,000

         = 1.91%

2014 = $7,552,000 /$4,269,000

         = 1.76%

2015 = $7,118,000 / $3,206,000

         = 2.2%

= operating profit / Net sales * 100

2013 = $1,047,000 / $ 9,138,000 * 100

         = 11.45%

2014 = $1,238,000 / $10,381,000 * 100

         = 11.9%

2015 = $593,000 / $8,782,000 * 100

         = 6.75%

Overall profit ability ratio:

         = Net profit / Total assets

2013 = $699,000 / $14,249,000

         = 0.049%

2014 = $811,000 / $12,892,000

         = 0.062%

2015 = $501,000 / $11,500,000

         = 0.043%

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