Financial Decision Making Assessment 2022

Running head: FINANCIAL DECISION MAKING
Financial Decision Making
Name of the Student:
Name of the University:
Author’s Note

FINANCIAL DECISION MAKING
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Table of Contents
Ratio Analysis..................................................................................................................................2
Profitability Ratios.......................................................................................................................2
Liquidity Ratios...........................................................................................................................4
Market Efficiency Ratio..............................................................................................................7
Leverage Ratios...........................................................................................................................9
Valuation and Growth Ratios....................................................................................................12
Reference.......................................................................................................................................14

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Ratio Analysis
Profitability Ratios
The profitability Ratios of the business shows estimates which makes comparison with
profitability much easier. The profitability ratios of the business include gross profit margin, net
profit margin, return on assets and return on equity of the business. In order to make effective
comparison the business of Marston’s Company and one of its main competitors Heineken NV
are taken into consideration showing key financial ratios of both the companies (Marstons.co.uk.
2019). The analysis shows that the gross profit margin for Marston company has declined in
2018 in comparison to previous year analysis which is mainly due to hike in the costs of the
business. Similarly, the profits of Heineken NV have also declined significantly over the years
but the same is still better than the business of Marston’s Company (Theheinekencompany.com.
2019). The net profit margin of both Marston and Heineken has also declined which is mainly
due to the increase in the operations of business. The net profit margin of both the companies

FINANCIAL DECISION MAKING
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show that the business of Heineken NV has better estimate in comparison to Marston Company.
This shows that in the aspect of profitability the competitor business is performing well.
2014 2015 2016 2017 2018 2014 2015 2016 2017 2018
Marston's Company Heineken NV
-6.22%
2.65%
7.79% 8.38%
3.94%
8.87%
10.44%
8.36% 8.33% 7.81%
Net Profit Margin
Figure 1: (Chart showing Net profit Margin for Both Companies)
Source: (Created by the Author)
The return on assets and return on equity is considered to be appropriate indicator for
measuring the success of the business in terms of profitability (Delen, Kuzey and Uyar 2013).
The return on assets and equity for Heineken is shown to be much better than the estimates
which is shown by Marston company. The management of Marston company needs to
appropriately manage the operations of the business so that the profitability aspect of the
business can be improved (Palepu and Healy 2013). A chart showing a comparison between
Marston and Heineken company in terms of return on equity is shown below: