Financial Data and Choosing stocks
posted by Anonymous .
Now that you’ve analyzed a company based on its financial statement, let’s compare two companies. Choose two related companies to answer the questions below (for example: Toyota & Honda, Apple & Microsoft).
1. What two companies did you choose? How are they related?
I chose the companies JACK(Jack In The Box Inc.) and WEN(Wendy's/ Arby's Group)
~Im not really sure if these companies are related, are they? And how? They are both restaurants, that provide burgers and all.
2. Which of your companies do you think has the better financial performance? Why?
I heard that Jack in the Box does, but I'm not sure.
3. Look up the three ratios for each company (P/E, ROE, and Pre Tax Profit Margin) and record them in a table.
Jack in the Box:
P/E = 15.5
ROE = 13.5
Pre Tax Profit Margin = 4.6
P/E = 24.9
ROE = 8.3
Pre Tax Profit Margin = 5.1
4. How might comparing financial statements and company performance help you to make investment decisions? Which of your companies would you invest in? Why?
Well you can find out which company makes higher profits. Just learning about this stuff, so what else?
I guess I would probably invest in Jack in the Box because its better with the ROE.