Motorola Moto G8 Power Lite Review

Over view of company

Motorola Solutions Inc. is one of the leading companies in the telecommunication industry around the world. It generates mobile phones and other electronics that it sells to its customers. The organization has a market capitalization of 12.84 billion dollars. The organization operates under Lenovo brand since 2011. This has led to the fading Motorola brand as the Lenovo brand takes over. In delivery of its products to customers, the organization has extended its operations to countries such as Australia, United States of America, China and Europe among others ( Robinson, 2012). Some of the firms competing with the organization are apple Inc., Samsung and Nokia among others. In spite of the huge global presence, the organization has recorded significant decline in performance in the past five years. This could be in part attributed to the increasing level of competition in the industry. 

Result of analyses

Over the five years period since 2011, profitability of Motorola solutions went down. Gross Profit margin declined from 0.49 to 0.48 over the same period. Net profit margin also went down from 0.15 in 2011 to 0.11 in 2012. This indicates the reducing ability of the organization to generate net income from its revenues ( Robinson, 2012). 

In regards to efficiency, Motorola’s efficiency in its operations has slightly improved between 2011 and 2015. This is evident from the slight rise in the organizations assets from 0.14 in 2011 to 0.15 in 2015. This indicates the increasing ability of the organization to utilize its assets in revenue generation. Inventory turnover also went up during the period from 6.53 in 2011 to 8.88 in 2015. This further indicates improvement in the organization’s ability to convert stock into sales ( Robinson, 2012). 

In regards to solvency, the debt ratio has declined over time. This indicates the reducing ability of the organization to meet its short term obligations. The ability of the organization o meets its short term and long term financial responsibilities significantly influence its sustainability. In particular, reduced performance income and growing debt increases the exposure of the organization to the risk of insolvency. 

In regards to liquidity, the organization has recorded slight decline in current ratio from 2011to 2015. The ratio declined from 2.19 to 2.11. This is an indicator of the reduced ability of the organization to meet its immediate obligations. 

Findings from financial statements

Between 2011 and 2015, the level of sales revenue generated by the organization declined sharply. The amount reduced from 8.2 billion in 2011 to 5.7 billion in 2015. This indicates that the ability of the organization to generate revenues from its operations has declined. Over the same period, the net income declined from 747million in 2011 to 648 million in 2015. This indicates the reducing ability of the organization to generate income from its operations 

During the accounting period d other leading competing firms outperformed Motorola when it comes to generation of profits as well as revenues Apple Inc. recorded 53.394 billion dollars in profits. This figure is too high to compare with Motorola’s income of less than one billion. The same case applies HP, Intel and Oracle whose net income surpassed that reported by Motorola. The decline in the organizations level of profitability as compared to that of its competitors indicates that the decline in the organization thus needs to be reverted if the organization is to continue operating successfully in the long run ( Thukaram, 2003). Besides the income statement, the balance sheet also provides key insight in the operations of the organization. It helps in identifying the financial position of an accounting entity at a given period in time. In this particular case, the organization level of assets held declined in the five year period. This indicates the reducing resource capability of the organization. The return on asset nevertheless slightly improved. This indicates that the organization’s efficacy in the utilization of assets to generate income had slightly improved ( Thukaram, R.2003). 

Stock information

Motorola has a beta of 0 .46. This indicates that investment in the organization attracts high level of risk. The market stock price for the organization is $77.12. The organization’s return is 7.38%. The maximum stock price that the investors should buy the organization’s stock is 107.38% of the current price at the close of the year which is equal to 82.81. the intrinsic value of the stock could not be easily computed through the dividend discount model since there was no issuance of dividend in the organization (Motorola Solutions, Inc., 2016). 

Final thoughts regarding the company

In overall, it is clear that Motorola is a risky investment destination. The organization has recorded decline in profitability. This has reduced the ability of the organization to reward its equity providers. Solvency ratios equally indicate that the organization is unfit as an investment destination since its ability to meet its long term obligations are on the decline. The organization has been outperformed by their peer competitors. This indicates the reducing ability of the organization to remain competitive in the industry. It indicates that the industry is not health investment destination. 

References 

Motorola Solutions, Inc. (2016). Technology Leadership . Retrieved from: http://www.motorolasolutions.com/en_us/about/company-overview/technology- leadership.html 

Robinson, T. R. (2012). International financial statement analysis . Hoboken, N.J: John Wiley & Sons. 

Thukaram, R. M. V. (2003). Management Accounting . New Delhi: New Age.