In this module, the discussion will focus on profitability analysis
In this module, the discussion will focus on profitability analysis. The student will need to find some publicly available information about two firms and then provide some analysis of that information.
Using the Internet, find Earnings Per Share and Price/Earnings ratio information for two competing publicly traded companies. State what you have found and provide a couple of sentences of explanation as to what those ratios tell you about the firms. Finally, provide some analysis of which firm you think would be the better investment, based on this information.
Post by classmate 1
For this discussion I have decided to compare Nike and Adidas. Nike’s earning per share is $3.75 and price/earnings is 27.97. Adidas’ earning per share is $0.85 and price/earnings is 28.06. I believe Nike would be a better investment because Adidas’ earning per share has had a 30.42% decline year-over-year and could possibly keep going down. Nike also has a higher earning per share which would in the long run make you more money.
“12.23 For Sept. 8, 2022.” Adidas PE Ratio, https://ycharts.com/companies/ADDYY/pe_ratio.
“Nike (NKE) – P/E Ratio.” CompaniesMarketCap.com – Companies Ranked by Market Capitalization, https://companiesmarketcap.com/nike/pe-ratio/#:~:text=According%20to%20Nike’s%20latest%20financial,P%2FE%20ratio%20of%2042.7.
Post by classmate 2
By researching two different trading companies, I realized that it really pointed me in the direction of Apple and Microsoft. These two companies are known worldwide and have been big influences in the technological world. It turns out that Apple and Microsoft were founded within one year of each other. While in 1975, Microsoft was created, not much later in 1976 Apple Inc was born.
I was interested in knowing the earnings per share that each offered in the present year of 2022. By looking into it, I found that Apple’s earning per share was deemed to be $1.20 (Diluted EPS), while the earnings ratio is $25.71. Next when it came to Microsoft, it showed as of June 2022 that its earnings per share are at $2.24 for the current period. (Diluted EPS) Not only that but as of September of 2022, the earnings ratio is $28.05.
Looking at Apple and Microsoft, I learned that currently it is best to invest with Microsoft. This is because the earnings per share are higher along with the ratio. Both companies have been around for many years, and they have been surpassing one another for many years on the charts. I do not see them dropping drastic anytime soon, so I would not disregard Apple.
https://www.google.com/search?q=whats%2Bthe%2Bearnings%2Bper%2Bshare%2Bin%2Bmicrosoft&oq=whats%2Bthe%2Bearnings%2Bper%2Bshare%2Bin%2Bmic&aqs=chrome.1.69i57j33i10i160l4j33i299j33i15i22i29i30j33i22i29i30l3.11680j0j4&sourceid=chrome&ie=UTF-8
https://www.macrotrends.net/stocks/charts/MSFT/microsoft/pe-ratio#:~:text=Microsoft%20PE%20ratio%20as%20of%20September%2007%2C%202022%20is%2027.53.
https://www.google.com/search?q=earnings%2Bper%2Bshare%2Bfor%2Bapple&sxsrf=ALiCzsajD6Z7-IQ6x1qCxFqcVhgNSdOirQ%3A1662643126460&ei=tusZY9fdG8GLwbkP-I-D8A8&oq=earn&gs_lcp=Cgdnd3Mtd2l6EAEYADIHCCMQJxCdAjIKCAAQsQMQgwEQQzIFCAAQkQIyBAgAEEMyBwgAELEDEEMyBAgAEEMyBwgAELEDEEMyEQguEIAEELEDEIMBEMcBENEDMgQIABBDMg0IABCABBCHAhCxAxAUOgcIIxDqAhAnOgcILhDqAhAnOgQIIxAnOgcIABDJAxBDOgUIABCSAzoLCC4QgAQQsQMQgwE6DgguEIAEELEDEMcBENEDOgcIABCABBAKOgcILhCABBAKOgcIIxCxAhAnOgsIABCxAxCDARCRAjoHCAAQsQMQCkoECEEYAEoECEYYAFCDEFjSIGC-L2gFcAF4AYAB-gOIAZcIkgEFNy41LTGYAQCgAQGwAQrAAQE&sclient=gws-wiz
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