Verified Document

Microsoft Dupont Analysis Of Microsoft Dupont Analysis Essay

Microsoft DuPont DuPont Analysis of Microsoft

DuPont Analysis Overview

The DuPont Analysis is a type of analysis that provides a more detailed look at a company's Return on Equity (ROE) by breaking it into three main components. The three components are profit margin, asset turnover and a leverage factor. By separating the ROE into these smaller categories, investors can quickly identify how effectively or efficiently a company is using their resources. If any of the three categories is performing poorly then this can lower the overall figure. To calculate a firm's ROE through Du Pont analysis, multiply the profit margin (net income divided by sales), asset turnover (sales divided by assets) and leverage factor (total assets divided by shareholders' equity) together - the higher the result, the higher the return on equity.

Microsoft's Profit Margin

Profit Margin = net income / total revenues

Income Statement

Revenue (ttm): 72.93B

Net Income: 15.46B

Profit Margin

15.46 / 72.93 = 22%

Microsoft obviously operates much differently than many brick and motor business such as retail establishments. However, when compared to companies in similar industries then this can help identify different aspects to the company and the industry. For example, Apple's profit margin is roughly 24% while MS was calculated to be only 22%. While the difference is only a couple of percent, both MS and Apple have billions in assets and revenues so 2% makes a rather…

Cite this Document:
Copy Bibliography Citation

Related Documents

Apple Investment and Financial Analysis
Words: 3620 Length: 13 Document Type: Essay

Apple Inc. Investment Analysis and Recommendations Apple Inc. is an American multinational company specializing in designing and producing mobile telecommunication devices that include iPhone, computer software and hardware, Apple TV, Apple Watch, iPod, and other electronic devices. Apple was incorporated and publicly registered in 1977. Headquartered in California, Apple is one of the most successful American companies in term of revenue with the annual revenue reaching $233.7 billion at the end

Financial Analysis for Google Vs. Yahoo
Words: 1110 Length: 4 Document Type: Research Paper

Goog Yhoo Google and Yahoo are two of the leaders in Internet search and advertising, and the flagship site of both ranks among the top sites on the Internet. This paper will take a look at the financial statements of these two companies, and analyze them. The first section starts with the balance sheet. The capital accounts of both companies are predominantly based on equity. Google has $3 billion in long-term debt,

Fundamental Analysis of Coach, Inc.
Words: 4440 Length: 15 Document Type: Term Paper

Economy (Market) Analysis Industry Analysis Company Analysis Brief History of the Company Analysis of Financial Statements (Ratio analysis) Liquidity Ratios: Current ratio Operating Efficiency: Asset Turnover Operating Profitability Ratios: Net profit margin, Return on Equity, and Du Pont Risk Analysis: Business Risk and Financial Risk, Variability, and Debt/Equity Application of CAPM and Analysis 10F.Estimating the Value of the Company and Analysis EPS 10• P/E 11• Sustainable Growth Rate 11• PEG 12• Investment Decisions 13G.Additional Measures of Relative Value and Analysis 13• P/BV 14• P/CF 14H.Measures of Value Added

Target Corporation NYSE: Tgt Is a Discount
Words: 1385 Length: 5 Document Type: Essay

Target Corporation (NYSE: TGT) is a discount store that operate almost entirely in the United States (it has plans to expand into Canada in the next couple of years). The company began life as Dayton's, but by the 1960s the Target name was had been launched and the company had begun to expand beyond its home market (Target.com, 2012). Today, Target operates two business divisions -- retail and credit card

Partnering With Amd Too Risky
Words: 2089 Length: 6 Document Type: Research Paper

AMD Analysis Advanced Micro Devices (AMD) is a company that has had varying fortunes and outcomes over the years. However, the last few years have been a definite downer for AMD as they are clearly moving in the wrong direction. However, rather than leave it to a quick and witty assertion, the author of this report will add some context and support for that statement. This will come in the form

Challenge of Managing All Stakeholders in the Context of a Merger...
Words: 23212 Length: 80 Document Type: Term Paper

Managing All Stakeholders in the Context of a Merger Process Review of the Relevant Literature Types of Mergers Identifying All Stakeholders in a Given Business Strategic Market Factors Driving Merger Activity Selection Process for Merger Candidates Summary, Conclusion, and Recommendations The Challenge of Managing All Stakeholders in the Context of a Merger Process Mergers and acquisitions became central features of organizational life in the last part of the 20th century, particularly as organizations seek to establish and

Sign Up for Unlimited Study Help

Our semester plans gives you unlimited, unrestricted access to our entire library of resources —writing tools, guides, example essays, tutorials, class notes, and more.

Get Started Now