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Financial Analysis of Pensonic and Panasonic
Added on -2019-09-16
This article provides a detailed financial analysis of Pensonic and Panasonic, including liquidity, leverage, profitability, and market preference. It compares the key financial ratios of both companies and provides insights into their financial health. The article also includes key financial inputs for both companies, such as current assets, liabilities, inventories, cash and cash equivalents, total assets, total debt, total equity, operating profit, gross profit, net profit, net sales, and total finance cost.
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ContentsAverage Returns and Standard Deviation:.............................................................................................2Financial Health analysis........................................................................................................................3Liquidity:............................................................................................................................................3Leverage:...........................................................................................................................................4Profitability:.......................................................................................................................................5Market Preference:...........................................................................................................................6Appendix 1: Key financial inputs............................................................................................................7Pensonic............................................................................................................................................7Panasonic:.........................................................................................................................................8References:............................................................................................................................................91
Average Returns and Standard Deviation:Below table summarizes the average returns and standard deviation of closing stock prices:Data01-Apr-1131-Mar-16DividendsPensonic 0.72 0.69 0.09 Panasonic 21.60 29.68 2.50 Average returnsPensonicPanasonicAppreciation (0.03) 8.08Dividend 0.09 2.50Total Return 0.06 10.58Average returns (%)2%10%Standard deviation in price 0.09 1.96The average returns for 5 year period for Pensonic is lower than that of Panasonic. Thus Panasonichas provided more returns to the shareholders than Pensonic during the period April 1, 2011 toMarch 31, 2016. In terms of volatility in share price, the standard deviation is higher for Panasonic.2
Financial Health analysisLiquidity:Below table summarizes the liquidity ratios for both the entities.Liquidity RatiosFormulaPensonic2016Pensonic2015Pensonic2014Pensonic2013Pensonic2012Current Ratio=Current Assets1.281.291.141.241.25Current LiabilitiesQuick Ratio=Current Assets -Inventories0.750.810.600.700.64Current LiabilitiesCash Ratio= Cash and cashequivalents0.090.110.080.100.08Total AssetsLiquidity RatiosFormulaPanasonic2016Panasonic2015Panasonic2014Panasonic2013Panasonic2012Current Ratio=Current Assets3.683.733.624.014.79Current LiabilitiesQuick Ratio=Current Assets -Inventories3.473.473.463.874.62Current LiabilitiesCash Ratio= Cash and cashequivalents0.610.640.630.610.62Total AssetsFrom the overall view, the liquidity ratio is expected to be more than 1 to suggest flexibility insettlement of short term obligations. Panasonic’s liquidity position is far superior to that of Pensonicas the former has current ratio of 3.68 and quick ratio of 3.47. The cash ratio of Panasonic is 61% asagainst 9% for Pensonic. Thus of the total assets held by Panasonic, 61% is held in cash and cashequivalents suggesting a very good cash position for it. Thus from the liquidity point of view,Panasonic’s financial health is better as it has huge cash reserves. This suggests that the company isable to generate enough cash out of operations to manage growth and sustenance.3
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