In 1972 the company reported Net Income of $172.7 million that increased by more than hundred percent to $497.3 million.
The financial performance of the company was characterized by steady and consistent growth and rising profitability. AHP increased revenues, earnings and shareholders’ dividends for straight 29 years. The company managed to retain the growth in the range of 10 percent and 15 percent in recent years. This growth was financed by the company through internal means even though it paid roughly 60 percent of the earnings as dividends.
The earnings growth of the company boosted the share price of the company by nearly three times. The steady growth in sales and rising EPS made the shares of the company an attractive ‘buy’ among the institutional investors. The low debt exposure of AHP seemed to work in favor of the company as it gained wider acceptance from the institutional investors. To couple with this the steady rise in the return on equity of the company seemed to attract more number of buyers which can be the reason for the three fold rise in the share price of the company.
The cash flow position of the company was also very strong as evident from the steady rise in the Cash position of the company. In 1976 the company had Cash of nearly $358.8 million that grew to $729.1 million. Even though the company declared a generous portion of the profits as dividend the cash reserves of the company kept rising steadily. In fact the growth in cash reserves even outpaced the growth rate in sales and profits. This ensured that the liquidity position of the company remained strong. A high liquidity, as measured by a high current ratio, is a good sign as it signifies that the company is capable of taking care of any financial emergency (Siegel, et al., 1997, pp80).
Warner Lambert was the only company that was comparable to AHP. Like AHP the former also operated in roughly the same businesses and had a debt ...
Cite this document
(“CASE STUDY Essay Example | Topics and Well Written Essays - 750 words - 4”, n.d.)
Retrieved from https://studentshare.net/miscellaneous/402072-case-study
(CASE STUDY Essay Example | Topics and Well Written Essays - 750 Words - 4)
“CASE STUDY Essay Example | Topics and Well Written Essays - 750 Words - 4”, n.d. https://studentshare.net/miscellaneous/402072-case-study.
percent, but a politically inexperienced governor feels that it is necessary to eliminate these programs thought it is necessary to eliminate the programs. Being the prisons director, I decided to give my response to the inexperienced governor that explains why the policies
Today, the meaning of propaganda is used comprehensively to connote public relations. The government uses mass relations to disseminate accurate information on policies and their adversaries. The two frequent features that presented propaganda’s new possibilities were mass
The amount of organizational takeovers and company mergers has been considered a standard of measure of the level of economic development. In most cases, company takeovers have been associated with incidents
sively become more complicated, labor shortages will become evident in most of the mature industries and companies especially in the developed countries. At the same time, a more than needed number of employees with skilled talent are likely to be seen in other areas and
A company should embrace technology in handling production process.
Bella India has skilled personnel as evidenced in the way management tackles technical issues such as reduction in transitional time between St Louis and
1 Pages(250 words)Essay
GOT A TRICKY QUESTION? RECEIVE AN ANSWER FROM STUDENTS LIKE YOU!
Let us find you another Essay on topic CASE STUDY for FREE!