Friday, February 26, 2010

Open Question: Interpretation of Financial Ratios?

I have calculated FR's for 30 Real Estate Developers in the GCC Countries. The Median Values for 2006,07,08 and Average of all 3 are apended. I request your opinions on the interpretation of the health of the companies. Sr. No.TYPE OF RATIOUnitMEAN PROFITABILITY AND PERFORMANCE RATIO'S 1ROCE - Return on Capital Employed%11.7% 2ROTA - Return on Total Assets%8.2% 3ROE - Return on Equity%14.0% 4ROS - Return on Sales (Profit Margin)%52.9% INVESTORS RATIO'S 6PE ratio - Price / Earnings RatioTimes 11.39 7Dividend Yield%3.3% 8Earnings Yield%7.6% 9Market to Book RatioTimes 1.81 EFFICIENCY AND EFFECTIVENESS 10Net Assets TurnoverTimes 0.25 11Fixed Assets TurnoverTimes 0.25 12Debtors TurnoverTimes 5.60 13Average Collection PeriodDays 66 14Creditors TurnoverTimes 5.00 15Stock TurnoverTimes 2.63 16Net Working Capital to Sales RatioTimes 0.22 17Sales to Working Capital RatioTimes 0.49 18Sales to Fixed Assets RatioTimes 0.25 19Inventory DaysDays 152 LIQUIDITY AND STABILITY RATIO'S 20Current Ratio (Working Capital Ratio)Times 1.30 21Quick Ratio (Acid Test Ratio)Times 0.91 CAPITAL STRUCTURE, INVESTMENT AND FINANCIAL RISK RATIOS 22Long-term Debt to Equity RatioTimes 0.31 23Long-term debt to total long-term finaTimes 0.23 24Total debt to total assets ratio Times 0.24 25Interest CoverTimes 12.51 26Dividend CoverTimes 2.77 27Fixed assets to total assets ratio Times 0.76 28Long-term Funds to Total Assets RatioTimes 0.72 29Total owing to total assets ratio Times 0.03 30Capital gearingTimes 1.01 31Gearing RatioTimes 0.48

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