First of all, finding ratios is important to give an idea if the company is capable to pay back its liabilities (debt) with assets (cash). Generally, companies would aim for a current ratio of at least 1 to make sure that the value of their current assets can cover at least the amount of the company’s short term obligations. Above in the financial statement, the current ratio is 4.0, this isn’t too bad because companies that have a current ratio over 1 provide a safe layer against unforeseeable and incidental expenses that may arise in the short term. Debt to Equity ratio is 0.86, for every $1 of Equity; there is 86 c of liability. This is fairly good because it is less than $1 which can be funded by Equity. The Net Profit ratio tells us how much profit being made from every dollar is earned, there is 15c profit from the information given above, for every dollar earned, there is 15c …show more content…
Like discussed above, the higher the market cap, the more flexibility of the company to be able to do well and have high earnings. Once again, there is a huge time difference between the Market Cap and the Equity, there is a total difference of 9 months and it doesn’t seem reliable because the accounts may change in 2015 and the Equity may go lower or higher. But looking past that, the business is still doing well because there is future growth and high earnings for the company.
The Market Capitalisation for Domino’s Pizza is $3.08 Billion as of 9th March and the Equity is $259,389. That straight up shows that Domino’s Pizza is doing really well because of the Market Cap is in the billions. One of the reasons is because of the brand name and good will. Domino’s pizza is practically world known which may be one of the reasons the Market Cap is really high. Yet again, the time differences are majorly 9 months apart, but as this company being popular and world known that everything may have stayed the same or infarct the market may have gone