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Finance & Accounting
Pages 3 (753 words)
CASE STUDY Table of Contents Table of Contents 2 Nike, Inc. – A Case Study 3 References 6 Nike, Inc. – A Case Study Nike Inc. is an US based company operating in the consumer goods sector. It is a well known brand all over the world. Nike Inc. is headquartered at Beaverton, Oregon and was founded in 1964, when it was known as Blue Ribbon Sports.
Equity shares of Nike Inc. are publicly traded in the New York Stock Exchange with the ticker symbol. Financial ratio analysis of Nike Inc. can prove to an important tool to measure the financial condition and health of Nike Inc. As of May 31, 1994 and 1995, the current ratios of Nike Inc. were 3.15 and 1.85 respectively. It meant Nike Inc. had a drastic reduction in the current ratio in the financial year 1994-95. This implied for every dollar of current liabilities Nike Inc. had only $1.85 available as current assets. Hence, it was a big question ahead of Nike Inc. to prove their liquidity position. Next if we compare the working capital of Nike Inc., it can be found that it had $ 1,208,444,000 and $ 938,393,000 as working capital as on May 31, 1994 and 1995 respectively. Thus, working capital also showed a huge decline for the company, which was also a big concern regarding the profitability of the company. The gross profit margin for the company remained almost same at 39.2% and 39.8% for the years 1994 and 1995, respectively. Hence, this profitability ratio did not show a much decline for Nike Inc. in the year 1995 relative to the year 1994. ...
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