INVESTMENTS 投资学 （博迪BODIE, KANE, MARCUS）Chap019 Financial Statement Analysis.ppt

1、CHAPTER 19,Financial Statement Analysis,2,Financial statement analysis can be used to discover mispriced securities. Financial accounting data are widely available, but Accounting earnings and economic earnings are not always the same thing!,Financial Statement Analysis,3,Income Statement: Profitabi

2、lity over time Balance Sheet: Financial condition at a point in time Statement of Cash Flows: Tracks the cash implications of transactions.,Financial Statements,4,Table 19.1 Consolidated Statement of Income for Hewlett-Packard, 2009,5,Table 19.2 Consolidated Balance Sheet for Hewlett-Packard, 2009,6

3、,Table 19.3 Statement of Cash Flows for Hewlett-Packard, 2009,7,Accounting Versus Economic Earnings,Economic earnings Sustainable cash flow that can be paid to stockholders without impairing productive capacity of the firm Accounting earnings Affected by conventions regarding the valuation of assets

4、,8,Profitability Measures,ROE measures profitability for contributors of equity capital. After-tax profit/book value of equity ROA measures profitability for all contributors of capital. EBIT/total assets,9,Past vs. Future ROE,ROE is a key determinant of earnings growth. Past profitability does not

5、guarantee future profitability. Security values are based on future profits. Expectations of future dividends determine todays stock value.,10,Financial Leverage and ROE,ROE can differ from ROA because of leverage. Leverage makes ROE more volatile. Let t=tax rate and r=interest rate, then:,11,Financ

6、ial Leverage and ROE,If there is no debt or ROA = r, ROE will simply equal ROA(1 - t). If ROA r, the firm earns more than it pays out to creditors and ROE increases. If ROA r, ROE will decline as a function of the debt-to-equity ratio.,12,Table 19.5 Impact of Financial Leverage on ROE,13,Decompositi

7、on of ROEDuPont Method,x,14,Decomposition of ROE,ROA=EBIT/Sales X Sales/Assets = margin X turnover Margin and turnover are unaffected by leverage. ROA reflects soundness of firms operations, regardless of how they are financed.,15,Decomposition of ROE,ROE=Tax burden X ROA X Compound leverage factor

8、Tax burden is not affected by leverage. Compound leverage factor= Interest burden X Leverage,16,Table 19.6 Ratio Decomposition Analysis for Nodett and Somdett,17,Choosing a Benchmark,Compare the companys ratios across time. Compare ratios of firms in the same industry. Cross-industry comparisons can

9、 be misleading.,18,Table 19.7 Differences between Profit Margin and Asset Turnover across Industries,19,Table 19.9 Summary of Key Financial Ratios,20,Table 19.9 Summary of Key Financial Ratios,21,Table 19.9 Summary of Key Financial Ratios,22,Table 19.9 Summary of Key Financial Ratios,23,Table 19.9 S

10、ummary of Key Financial Ratios,24,Figure 19.1 DuPont Decomposition for Hewlett-Packard,25,Economic Value Added,EVA is the difference between return on assets (ROA) and the opportunity cost of capital (k), multiplied by the capital invested in the firm. EVA is also called residual income If ROA k, va

11、lue is added to the firm.,26,Example 19.4 Wal-Mart,In 2009, Wal-Marts cost of capital was 5.9%. Its ROA was 9.6% and its capital base was $115 billion. Wal-Marts EVA = (0.096-0.059) x $115 billion = $4.25 billion,27,Accounting Differences Inventory Valuation Depreciation Inflation and Interest Expen

12、se Fair Value Accounting Quality of Earnings International Accounting Conventions,Comparability Problems,28,International Accounting Differences,Reserves many other countries allow more flexibility in use of reserves Depreciation US allows separate tax and reporting presentations Intangibles treatment varies widely,29,Figure 19.2 Adjusted Versus Reported Price-Earnings Ratios,30,The Graham