In the attached excel sheet, financial statements from Intel are attached and considered. Among other things, the paper intends to discuss the financial health of the company by analyzing its ratios. From the data above, the balance sheet and income statements were obtained so as to provide indicators of the financial health of the company. In this paper, a review of the information found from the ratio analysis is done to determine the company’s financial health between the years.
The first ratio required is the current ratio, which indicates the company’s ability to pay back its liabilities using its assets. A ratio of over 1.0 indicates that the company is in good financial health. From the company information provided, the company had a ratio of 2.58 in 2016 which fell to 1.75 in 2017, indicating that the company’s financial health went down slightly but remained in acceptable levels. The debt ratio, on the other hand, determines how much of the company’s assets are financed by debt. From the indications on the ratios, Intel’s figures over the last three years indicated that the company was increasing its debt when obtaining assets. The fact that the value is well over 100% indicates that the company is going further into debt.
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Quick ratio is also provided. Despite fluctuations, the quick ratio remains within healthy boundaries. The debt/equity ratio also remains below 1.0, indicating that the company maintains enough money to meet its financial obligation to the stakeholders. Days sales outstanding also reduced in the last two years, indicating better performance for the company. The profit margin increased over the last two years, also indicating increasing sales. Therefore, it is possible to conclude that the company generally has good financial health.
References
Financial Morning Star. (2017). Intel Corp INTC . Retrieved from Financial Morning Star: http://financials.morningstar.com/ratios/r.html?t=INTC
UNITED STATES SECURITIES AND EXCHANGE COMMISSION. (2016). Intel Corporation . Retrieved from UNITED STATES SECURITIES AND EXCHANGE COMMISSION: https://www.sec.gov/Archives/edgar/data/50863/000005086316000105/a10kdocument12262015q4.htm#s1598D7570B555CBBB46E68E42576C6ED
