Financial Analysis of Tesla and Daimler

Financial Analysis
Management & Enterprises -
FAME

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Overview of both organisation....................................................................................................1
1. Critically compare and contrast the financial performance and financial position of Tesla
and Daimler over the last four years...........................................................................................2
Horizontal analysis of Balance sheet .........................................................................................3
2. Critically analyses the cash position of both companies.........................................................8
CONCLUSION................................................................................................................................9
REFERENCES..............................................................................................................................10
Appendices.....................................................................................................................................11

INTRODUCTION
Financial analysis is one of the key tool which is applied by manager to analysis actual
performance of business. As per purpose, they are constantly querying the financial analyst about
the profitability, cash flow and different aspects of financial activities (Bezzina and et.al., 2014).
It is examination of a business from a variety of perspectives in regard of fully understand the
greater financial situation and analysis how best to strengthen the business. The main purpose to
prepare this report to recognise financial strength as well as weakness to identify strongest
company. This analysis helps a business to identify different aspects that related with business
and impact on financial activities like profitability and stability for solvency as well as liquidity.
This report based on two companies of Tesla and Daimler. In present time both companies are
playing significant role in automotive sector. In this report analysis of financial performance over
the last four year (2015 - 2018). For financial analysis apply different types of tools like ratio
analysis, vertical and horizontal analysis.
MAIN BODY
Overview of both organisation
Tesla Inc.- It is an American electric Vehicle and clean energy company that based on
the Palo Alto, California. This organisation had been established in July 1, 2003 by Martin
Eberhard, Marc Tarpenning. It is mainly dealing into electric vehicles and Tesla energy. The
company is dealing into particular products like battery energy storage, electric vehicle
manufacturing, home to grid scale and many others. It is famous organisation that get position of
best selling plug in and best selling battery electric passenger car manufacturer in the year of
2019. The sales of the organisation is enhanced by 50% from 245240 units in 2018. to 367849
units in 2019.
Daimler: It is a famous German multinational automotive sector organisation which is
mainly dealing into commercial vehicles. The company has been situated in Mercedreesstarb,
Stuttgart, Germany. It was established in 28 June 1926 by Benz & Cie. Daimler is getting
position of 13 as car manufacturing and largest truck manufacturer in the world. This company
provide all relevant financial services by the Daimler financial services arm. This organisation is
part of the Euro Stoxx 50 stock market index.
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1. Critically compare and contrast the financial performance and financial position of Tesla and
Daimler over the last four years
To analysis the financial position of business require to use different types of tools and
techniques that helps to understand strongest financial position. There are using tools are ratio
analysis, horizontal and vertical analysis in proper manner. Along with identified of financial
strength and weakness of both companies and concluded that (Chang and et.al., 2016).
Vertical Analysis: It is a method of financial statement in which focus on every item
which is mentioned in statement and take as percentage on the basis of particular figure. Hence,
line items of vertical analysis based on the percentage of gross sales, on the other side in balance
sheet take total assets as percentage and for the cash flow statement take total cash flow as
percentage for recognise cash inflow and outflow of company. There are conducting analysis of
both organisation for 4 years from 2015 to 2018 that are attached in appendices. All the data
information based on the vertical FS of companies that are as following:
Vertical analysis in income statement
Tesla Inc.: There are sales taking as a base for whole analysis after that focus on the
income statement of an organisation. There are sales of Tesla take as 100 percentage after that
analysis cost of
Daimler: There are conducting Horizontal analysis of income statement which is based
on 2018 increment in revenue was 1.85% while it is increasing with 7.225 in 2017 and 2.54% in
2016. After that identified that gross profit which was -3.68% in 2018 but increasing by 7.41%,
0.52% in 2017 to 2016 respectively. Moreover cost of sales in the year 2018 was 3.3.% that
increased and reach on 7.17% in 2017 and 3.08% in the year 2016. The operating income was -
3.74% in 2016 that increase in 2016 and reached on 7.54% and finally in 2018 it was again
decreasing and reach on -22.54%. Along with the net income was -31.13% in 2018 that was
converting in positive 23.45% in 2017 and in 2016 reached on 1.21% in decreasing manner.
These changes impact on changeable position that shows company had not effective position as
per the growth (Liang, 2018).
Tesla Inc.: There are analysed changes in percentage and evaluate the position of
business in changing years. In 2018 revenues was 100% which was remaining same in 2017 as
well as 2016 & 2015 respectively. From revenues less amount of cost of sales and in 2015 get
amount of 77.19% that was increasing year on year like 77.16%, 81.10%, 81.17% from 2016 to
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