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Friday, December 27, 2019

Financial Analysis on Retail Industry Essay - 2369 Words

Executive Summary This analysis studied financial information of three multinational corporations in the retail industry, Ralph Lauren, American Eagle, and Gap. This examination is predominantly and analysis of Ralph Lauren and American Eagle, and it compares its financials and performance to that of Gap. In order to reach a decision on which firm my company should invest in; we recreated and cleaned both company’s financial statements followed by an analysis using key financial ratios and metrics. My company is searching for the firm that would be more profitable in the following fiscal years. After completing an in-depth analysis of these companies, we concluded that Gap would be the best investment for future growth in the†¦show more content†¦Gap intensified its international strategy as well, opening stores in Europe and China, and outlets; accompanied by an e-commerce platform in Canada, Europe, and China. The company has 22% of sales from regions outside t he US, up 7.6% from the year-ago period. This industry shows a thrust of penetration in the international markets looking to increase in the next few years. Teenagers also play an important role in the industry trends. With 7.1% of US population they have been a powerful force in retail with the leading beneficiaries being Gap, Abercrombie, American Eagle, and Urban Outfitters. This ties sales growth for both Gap and American Eagle due to a majority of the teen population shopping at these two companies. Helping increase sales growth and produce for revenues for the firm. The biggest window for opportunity in the retail sector seems to be the overseas markets but especially China, according to the SP industry reports. Gap’s profitability has grown over the past three years showing larger EBIT and EBITDA margins which shows strong management and healthy earnings. Ralph Lauren is also growing profitably as well as their margins have increased with time. American Eagle has been on teetering between being profitable and running efficiently to stay in the game. Net Income Growth 3 Yr Trend Polo 18.4% 20.0% American Eagle -16.8% 7.9% Gap 14.0%Show MoreRelatedAlban Group Sells Famous Electronic Appliances Across Sri Lanka.882 Words   |  4 PagesSoundest and most trusted financial solutions provider in the industry. Mission Abans Private Limited currently have a network of over 230 showrooms across Sri Lanka. Abans also have more than 400 authorized dealers representing them in the remotest rural areas bringing their products within reach of each family and every household in the country. All products sold by Abans carry a trusted guarantee of quality and reliable after sales service. (Abans..., 2011) Abans Retail Abans Retail Channel showroomsRead MoreWhat Does This Change Mean For 7 Twenty Stores? 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