Write a 100 word analysis on your overall interpretation of the financial health of the company below. Include if you would recommend investing in this company and explain your reasoning. Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Total Revenue $31,536,000 $24,578,000 $21,461,000 $11,759,000 Cost of Revenue $24,906,000 $20,509,000 $17,419,000 $9,536,000 Gross Profit $6,630,000 $4,069,000 $4,042,000 $2,223,000 Operating Expenses Research and Development $1,491,000 $1,343,000 $1,460,000 $1,378,000 Sales, General and Admin. $3,145,000 $2,646,000 $2,835,000 $2,477,000 Non-Recurring Items -- $149,000 $135,000 -- Other Operating Items -- -- -- -- Operating Income $1,994,000 -$69,000 -$388,000 -$1,632,000 Add'l income/expense items -$92,000 $89,000 $46,000 -$106,000 Earnings Before Interest and Tax $1,902,000 $20,000 -$342,000 -$1,738,000 Interest Expense $748,000 $685,000 $663,000 $471,000 Earnings Before Tax $1,154,000 -$665,000 -$1,005,000 -$2,209,000 Income Tax $292,000 $110,000 $58,000 $32,000 Minority Interest -- -- -- -- Equity Earnings/Loss Unconsolidated Subsidiary -$172,000 -$95,000 $87,000 $279,000 Net Income-Cont. Operations $690,000 -$870,000 -$976,000 -$1,962,000 Net Income $690,000 -$870,000 -$976,000 -$1,962,000 Net Income Applicable to Common Shareholders $690,000 -$870,000 -$976,000 -$1,962,000 Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Current Assets Cash and Cash Equivalents $19,384,000 $6,268,000 $3,879,000 $3,523,237 Short-Term Investments -- -- -- -- Net Receivables $1,886,000 $1,324,000 $949,000 $515,381 Inventory $4,101,000 $3,552,000 $3,113,000 $2,263,537 Other Current Assets $1,346,000 $959,000 $366,000 $268,365 Total Current Assets $26,717,000 $12,103,000 $8,307,000 $6,570,520 Long-Term Assets Long-Term Investments -- -- $422,000 $456,652 Fixed Assets $17,396,000 $14,061,000 $13,420,000 $14,144,126 Goodwill $207,000 $198,000 $68,000 $60,237 Intangible Assets $313,000 $339,000 $282,000 $361,502 Other Assets $7,515,000 $7,608,000 $7,241,000 $7,062,335 Deferred Asset Charges -- -- -- -- Total Assets $52,148,000 $34,309,000 $29,740,000 $28,655,372 Current Liabilities Accounts Payable $9,906,000 $6,993,000 $5,499,000 $4,121,616 Short-Term Debt / Current Portion of Long-Term Debt $2,132,000 $1,785,000 $2,568,000 $896,549 Other Current Liabilities $2,210,000 $1,889,000 $1,926,000 $2,656,505 Total Current Liabilities $14,248,000 $10,667,000 $9,993,000 $7,674,670 Long-Term Debt $9,556,000 $11,634,000 $9,404,000 $9,418,319 Other Liabilities $3,330,000 $2,691,000 $3,039,000 $4,752,192 Deferred Liability Charges $1,284,000 $1,207,000 $991,000 $1,177,799 Misc. Stocks $850,000 $849,000 $834,000 $997,346 Minority Interest $655,000 $643,000 $556,000 $397,804 Total Liabilities $29,268,000 $27,048,000 $24,261,000 $24,020,326 Stock Holders Equity Common Stocks $1,000 $1,000 -- $169 Capital Surplus -$5,399,000 -$6,083,000 -$5,318,000 -$4,974,299 Retained Earnings -- -- -- -- Treasury Stock $27,260,000 $12,736,000 $10,249,000 $9,178,024 Other Equity $363,000 -$36,000 -$8,000 $33,348 Total Equity $22,225,000 $6,618,000 $4,923,000 $4,237,242 Total Liabilities & Equity $52,148,000 $34,309,000 $29,740,000 $28,655,372 Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Net Income $690,000 -$870,000 -$976,000 -$1,962,000 Cash Flows-Operating Activities Depreciation $2,502,000 $2,342,000 $2,060,000 $1,727,000 Net Income Adjustments $2,395,000 $1,187,000 $1,043,000 $950,000 Changes in Operating Activities Accounts Receivable -$652,000 -$367,000 -$497,000 -$25,000 Changes in Inventories -$422,000 -$429,000 -$1,023,000 -$179,000 Other Operating Activities -$1,667,000 -$937,000 -$504,000 -$1,610,000 Liabilities $2,925,000 $1,384,000 $2,082,000 $1,317,000 Net Cash Flow-Operating $5,943,000 $2,405,000 $2,098,000 -$61,000 Cash Flows-Investing Activities Capital Expenditures -$3,232,000 -$1,432,000 -$2,319,000 -$4,081,000 Investments -- -- -- -- Other Investing Activities $100,000 -$4,000 -$18,000 -$115,000 Net Cash Flows-Investing -$3,132,000 -$1,436,000 -$2,337,000 -$4,196,000 Cash Flows-Financing Activities Sale and Purchase of Stock $12,675,000 $1,555,000 $727,000 $1,272,000 Net Borrowings -$2,488,000 $798,000 $89,000 $3,385,000 Other Financing Activities -- -- -- -- Net Cash Flows-Financing $9,973,000 $1,529,000 $574,000 $4,415,000 Effect of Exchange Rate $334,000 $8,000 -$23,000 $40,000 Net Cash Flow $13,118,000 $2,506,000 $312,000 $198,000 Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Liquidity Ratios Current Ratio 188% 113% 83% 86% Quick Ratio 159% 80% 52% 56% Cash Ratio 136% 59% 39% 46% Profitability Ratios Gross Margin 21% 17% 19% 19% Operating Margin 6% 0% 0% 0% Pre-Tax Margin 4% 0% 0% 0% Profit Margin 2% 0% 0% 0% Pre-Tax ROE 5% 0% 0% 0% After Tax ROE 3% 0% 0% 0%
Write a 100 word analysis on your overall interpretation of the financial health of the company below. Include if you would recommend investing in this company and explain your reasoning. Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Total Revenue $31,536,000 $24,578,000 $21,461,000 $11,759,000 Cost of Revenue $24,906,000 $20,509,000 $17,419,000 $9,536,000 Gross Profit $6,630,000 $4,069,000 $4,042,000 $2,223,000 Operating Expenses Research and Development $1,491,000 $1,343,000 $1,460,000 $1,378,000 Sales, General and Admin. $3,145,000 $2,646,000 $2,835,000 $2,477,000 Non-Recurring Items -- $149,000 $135,000 -- Other Operating Items -- -- -- -- Operating Income $1,994,000 -$69,000 -$388,000 -$1,632,000 Add'l income/expense items -$92,000 $89,000 $46,000 -$106,000 Earnings Before Interest and Tax $1,902,000 $20,000 -$342,000 -$1,738,000 Interest Expense $748,000 $685,000 $663,000 $471,000 Earnings Before Tax $1,154,000 -$665,000 -$1,005,000 -$2,209,000 Income Tax $292,000 $110,000 $58,000 $32,000 Minority Interest -- -- -- -- Equity Earnings/Loss Unconsolidated Subsidiary -$172,000 -$95,000 $87,000 $279,000 Net Income-Cont. Operations $690,000 -$870,000 -$976,000 -$1,962,000 Net Income $690,000 -$870,000 -$976,000 -$1,962,000 Net Income Applicable to Common Shareholders $690,000 -$870,000 -$976,000 -$1,962,000 Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Current Assets Cash and Cash Equivalents $19,384,000 $6,268,000 $3,879,000 $3,523,237 Short-Term Investments -- -- -- -- Net Receivables $1,886,000 $1,324,000 $949,000 $515,381 Inventory $4,101,000 $3,552,000 $3,113,000 $2,263,537 Other Current Assets $1,346,000 $959,000 $366,000 $268,365 Total Current Assets $26,717,000 $12,103,000 $8,307,000 $6,570,520 Long-Term Assets Long-Term Investments -- -- $422,000 $456,652 Fixed Assets $17,396,000 $14,061,000 $13,420,000 $14,144,126 Goodwill $207,000 $198,000 $68,000 $60,237 Intangible Assets $313,000 $339,000 $282,000 $361,502 Other Assets $7,515,000 $7,608,000 $7,241,000 $7,062,335 Deferred Asset Charges -- -- -- -- Total Assets $52,148,000 $34,309,000 $29,740,000 $28,655,372 Current Liabilities Accounts Payable $9,906,000 $6,993,000 $5,499,000 $4,121,616 Short-Term Debt / Current Portion of Long-Term Debt $2,132,000 $1,785,000 $2,568,000 $896,549 Other Current Liabilities $2,210,000 $1,889,000 $1,926,000 $2,656,505 Total Current Liabilities $14,248,000 $10,667,000 $9,993,000 $7,674,670 Long-Term Debt $9,556,000 $11,634,000 $9,404,000 $9,418,319 Other Liabilities $3,330,000 $2,691,000 $3,039,000 $4,752,192 Deferred Liability Charges $1,284,000 $1,207,000 $991,000 $1,177,799 Misc. Stocks $850,000 $849,000 $834,000 $997,346 Minority Interest $655,000 $643,000 $556,000 $397,804 Total Liabilities $29,268,000 $27,048,000 $24,261,000 $24,020,326 Stock Holders Equity Common Stocks $1,000 $1,000 -- $169 Capital Surplus -$5,399,000 -$6,083,000 -$5,318,000 -$4,974,299 Retained Earnings -- -- -- -- Treasury Stock $27,260,000 $12,736,000 $10,249,000 $9,178,024 Other Equity $363,000 -$36,000 -$8,000 $33,348 Total Equity $22,225,000 $6,618,000 $4,923,000 $4,237,242 Total Liabilities & Equity $52,148,000 $34,309,000 $29,740,000 $28,655,372 Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Net Income $690,000 -$870,000 -$976,000 -$1,962,000 Cash Flows-Operating Activities Depreciation $2,502,000 $2,342,000 $2,060,000 $1,727,000 Net Income Adjustments $2,395,000 $1,187,000 $1,043,000 $950,000 Changes in Operating Activities Accounts Receivable -$652,000 -$367,000 -$497,000 -$25,000 Changes in Inventories -$422,000 -$429,000 -$1,023,000 -$179,000 Other Operating Activities -$1,667,000 -$937,000 -$504,000 -$1,610,000 Liabilities $2,925,000 $1,384,000 $2,082,000 $1,317,000 Net Cash Flow-Operating $5,943,000 $2,405,000 $2,098,000 -$61,000 Cash Flows-Investing Activities Capital Expenditures -$3,232,000 -$1,432,000 -$2,319,000 -$4,081,000 Investments -- -- -- -- Other Investing Activities $100,000 -$4,000 -$18,000 -$115,000 Net Cash Flows-Investing -$3,132,000 -$1,436,000 -$2,337,000 -$4,196,000 Cash Flows-Financing Activities Sale and Purchase of Stock $12,675,000 $1,555,000 $727,000 $1,272,000 Net Borrowings -$2,488,000 $798,000 $89,000 $3,385,000 Other Financing Activities -- -- -- -- Net Cash Flows-Financing $9,973,000 $1,529,000 $574,000 $4,415,000 Effect of Exchange Rate $334,000 $8,000 -$23,000 $40,000 Net Cash Flow $13,118,000 $2,506,000 $312,000 $198,000 Period Ending: 12/31/2020 12/31/2019 12/31/2018 12/31/2017 Liquidity Ratios Current Ratio 188% 113% 83% 86% Quick Ratio 159% 80% 52% 56% Cash Ratio 136% 59% 39% 46% Profitability Ratios Gross Margin 21% 17% 19% 19% Operating Margin 6% 0% 0% 0% Pre-Tax Margin 4% 0% 0% 0% Profit Margin 2% 0% 0% 0% Pre-Tax ROE 5% 0% 0% 0% After Tax ROE 3% 0% 0% 0%
Financial Management: Theory & Practice
16th Edition
ISBN:9781337909730
Author:Brigham
Publisher:Brigham
Chapter2: Financial Statements, Cash Flow,and Taxes
Section: Chapter Questions
Problem 21SP: Begin with the partial model in the file Ch02 P21 Build a Model.xlsx on the textbooks Web site. a....
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Write a 100 word analysis on your overall interpretation of the financial health of the company below. Include if you would recommend investing in this company and explain your reasoning.
| Period Ending: | 12/31/2020 | 12/31/2019 | 12/31/2018 | 12/31/2017 |
|---|---|---|---|---|
| Total Revenue | $31,536,000 | $24,578,000 | $21,461,000 | $11,759,000 |
| Cost of Revenue | $24,906,000 | $20,509,000 | $17,419,000 | $9,536,000 |
| Gross Profit | $6,630,000 | $4,069,000 | $4,042,000 | $2,223,000 |
| Operating Expenses | ||||
| Research and Development | $1,491,000 | $1,343,000 | $1,460,000 | $1,378,000 |
| Sales, General and Admin. | $3,145,000 | $2,646,000 | $2,835,000 | $2,477,000 |
| Non-Recurring Items | -- | $149,000 | $135,000 | -- |
| Other Operating Items | -- | -- | -- | -- |
| Operating Income | $1,994,000 | -$69,000 | -$388,000 | -$1,632,000 |
| Add'l income/expense items | -$92,000 | $89,000 | $46,000 | -$106,000 |
| Earnings Before Interest and Tax | $1,902,000 | $20,000 | -$342,000 | -$1,738,000 |
| Interest Expense | $748,000 | $685,000 | $663,000 | $471,000 |
| Earnings Before Tax | $1,154,000 | -$665,000 | -$1,005,000 | -$2,209,000 |
| Income Tax | $292,000 | $110,000 | $58,000 | $32,000 |
| Minority Interest | -- | -- | -- | -- |
| Equity Earnings/Loss Unconsolidated Subsidiary | -$172,000 | -$95,000 | $87,000 | $279,000 |
| Net Income-Cont. Operations | $690,000 | -$870,000 | -$976,000 | -$1,962,000 |
| Net Income | $690,000 | -$870,000 | -$976,000 | -$1,962,000 |
| Net Income Applicable to Common Shareholders | $690,000 | -$870,000 | -$976,000 | -$1,962,000 |
| Period Ending: | 12/31/2020 | 12/31/2019 | 12/31/2018 | 12/31/2017 |
|---|---|---|---|---|
| Current Assets | ||||
| Cash and Cash Equivalents | $19,384,000 | $6,268,000 | $3,879,000 | $3,523,237 |
| Short-Term Investments | -- | -- | -- | -- |
| Net Receivables | $1,886,000 | $1,324,000 | $949,000 | $515,381 |
| Inventory | $4,101,000 | $3,552,000 | $3,113,000 | $2,263,537 |
| Other Current Assets | $1,346,000 | $959,000 | $366,000 | $268,365 |
| Total Current Assets | $26,717,000 | $12,103,000 | $8,307,000 | $6,570,520 |
| Long-Term Assets | ||||
| Long-Term Investments | -- | -- | $422,000 | $456,652 |
| Fixed Assets | $17,396,000 | $14,061,000 | $13,420,000 | $14,144,126 |
| $207,000 | $198,000 | $68,000 | $60,237 | |
| Intangible Assets | $313,000 | $339,000 | $282,000 | $361,502 |
| Other Assets | $7,515,000 | $7,608,000 | $7,241,000 | $7,062,335 |
| Deferred Asset Charges | -- | -- | -- | -- |
| Total Assets | $52,148,000 | $34,309,000 | $29,740,000 | $28,655,372 |
| Current Liabilities | ||||
| Accounts Payable | $9,906,000 | $6,993,000 | $5,499,000 | $4,121,616 |
| Short-Term Debt / Current Portion of Long-Term Debt | $2,132,000 | $1,785,000 | $2,568,000 | $896,549 |
| Other Current Liabilities | $2,210,000 | $1,889,000 | $1,926,000 | $2,656,505 |
| Total Current Liabilities | $14,248,000 | $10,667,000 | $9,993,000 | $7,674,670 |
| Long-Term Debt | $9,556,000 | $11,634,000 | $9,404,000 | $9,418,319 |
| Other Liabilities | $3,330,000 | $2,691,000 | $3,039,000 | $4,752,192 |
| Deferred Liability Charges | $1,284,000 | $1,207,000 | $991,000 | $1,177,799 |
| Misc. Stocks | $850,000 | $849,000 | $834,000 | $997,346 |
| Minority Interest | $655,000 | $643,000 | $556,000 | $397,804 |
| Total Liabilities | $29,268,000 | $27,048,000 | $24,261,000 | $24,020,326 |
| Stock Holders Equity | ||||
| Common Stocks | $1,000 | $1,000 | -- | $169 |
| Capital Surplus | -$5,399,000 | -$6,083,000 | -$5,318,000 | -$4,974,299 |
| -- | -- | -- | -- | |
| $27,260,000 | $12,736,000 | $10,249,000 | $9,178,024 | |
| Other Equity | $363,000 | -$36,000 | -$8,000 | $33,348 |
| Total Equity | $22,225,000 | $6,618,000 | $4,923,000 | $4,237,242 |
| Total Liabilities & Equity | $52,148,000 | $34,309,000 | $29,740,000 | $28,655,372 |
| Period Ending: | 12/31/2020 | 12/31/2019 | 12/31/2018 | 12/31/2017 |
|---|---|---|---|---|
| Net Income | $690,000 | -$870,000 | -$976,000 | -$1,962,000 |
| Depreciation | $2,502,000 | $2,342,000 | $2,060,000 | $1,727,000 |
| Net Income Adjustments | $2,395,000 | $1,187,000 | $1,043,000 | $950,000 |
| Changes in Operating Activities | ||||
| Accounts Receivable | -$652,000 | -$367,000 | -$497,000 | -$25,000 |
| Changes in Inventories | -$422,000 | -$429,000 | -$1,023,000 | -$179,000 |
| Other Operating Activities | -$1,667,000 | -$937,000 | -$504,000 | -$1,610,000 |
| Liabilities | $2,925,000 | $1,384,000 | $2,082,000 | $1,317,000 |
| Net Cash Flow-Operating | $5,943,000 | $2,405,000 | $2,098,000 | -$61,000 |
| Cash Flows-Investing Activities | ||||
| Capital Expenditures | -$3,232,000 | -$1,432,000 | -$2,319,000 | -$4,081,000 |
| Investments | -- | -- | -- | -- |
| Other Investing Activities | $100,000 | -$4,000 | -$18,000 | -$115,000 |
| Net Cash Flows-Investing | -$3,132,000 | -$1,436,000 | -$2,337,000 | -$4,196,000 |
| Cash Flows-Financing Activities | ||||
| Sale and Purchase of Stock | $12,675,000 | $1,555,000 | $727,000 | $1,272,000 |
| Net Borrowings | -$2,488,000 | $798,000 | $89,000 | $3,385,000 |
| Other Financing Activities | -- | -- | -- | -- |
| Net Cash Flows-Financing | $9,973,000 | $1,529,000 | $574,000 | $4,415,000 |
| Effect of Exchange Rate | $334,000 | $8,000 | -$23,000 | $40,000 |
| Net Cash Flow | $13,118,000 | $2,506,000 | $312,000 | $198,000 |
| Period Ending: | 12/31/2020 | 12/31/2019 | 12/31/2018 | 12/31/2017 |
|---|---|---|---|---|
| 188% | 113% | 83% | 86% | |
| Quick Ratio | 159% | 80% | 52% | 56% |
| Cash Ratio | 136% | 59% | 39% | 46% |
| Profitability Ratios | ||||
| Gross Margin | 21% | 17% | 19% | 19% |
| Operating Margin | 6% | 0% | 0% | 0% |
| Pre-Tax Margin | 4% | 0% | 0% | 0% |
| Profit Margin | 2% | 0% | 0% | 0% |
| Pre-Tax ROE | 5% | 0% | 0% | 0% |
| After Tax ROE | 3% | 0% | 0% | 0% |
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