Business Valuation of Polo Ralph Lauren Corporation - Mark Moore ...

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AppendixCross Sectional (Benchmark) AnalysisComparison between Polo and Competitors:Companies, and IndustryPoloRalphLaurenTommyHilfigerLizClabourne Gap4/3/2004 4/3/2004 4/3/2004 4/3/2004Liquidity AnalysisCurrent ratios 2.54 3.86 2.56 2.68Quick asset ratio 1.63 2.51 1.4 3.75Operating Efficiency RatiosA/R turnover 6 4.5 10.72 N/ADays supply of receivables 60.8 81.09 34.04 N/AInventory turnover 3.65 4.91 4.85 5.8Days supply of inventory 100 196.95 79.31 66.88Working capital turnover 3.44 3.21 2.84 2.12Profitability AnalysisGross profit margin 55.58% 46.04% 44.56% 37.64%Operating expense ratio 89.70% 89.46% 89.15% 88.58%Net Profit Margin 7.18% 7.05% 6.59% 6.5%Asset turnover 1.17 0.94 1.37 1.2ROA 7.53% 4.42% 10.73% 9.96%ROE 12% 6.44% 17.73% 21.53%P/E Ratio (TTM) 17 9.25 17.27 17Capital Structure AnalysisDebt to Equity Ratio 0.6 0.75 0.672 1.1Times Interest Earned 2.74 1.54 1.76 1.76Debt Service Margin N/A 9.08 1.16 2.82Other RatiosPlant, Property, and6.67 6.88 6.4 5.24Equipment TurnoverSustainable Growth Rate 11% N/A 14.10% 9.70%38
Gross Profit Margin 4/3/2004 3/29/2003 3/30/2002 3/31/2001 4/1/2000Polo Rl 55.58 55.16 54.04 53.62 55.66Tommy Hilfiger 46.04 43.94 42.82 40.65 44.18Liz Clabourne 44.56 43.57 41.39 39.75 39.11Gap 37.64 33.99 29.92 37.11 41.77Gross Profit Margin605040%302010Polo RlTommy HilfigerLiz ClabourneGap02004 2003 2002 2001 2000Years39
Page 1 and 2: Business Valuation of Polo Ralph La
Page 3 and 4: Executive SummaryThe objective of t
Page 5 and 6: Industry Overview and Analysis.Comp
Page 7 and 8: Products and Services:Polo Ralph La
Page 9 and 10: Company-operated a total of 3,022 s
Page 11 and 12: Ralph Lauren lifestyle through new
Page 13 and 14: Lauren must remain a respected inno
Page 15: Net Accounts ReceivableA reserve fo
Page 18 and 19: offset by the increase in selling s
Page 20 and 21: Evaluation of the Quality of Disclo
Page 22 and 23: Ratio Analysis of Polo Ralph Lauren
Page 24 and 25: for the company. The Times Interest
Page 26 and 27: average of this ratio, with the exc
Page 28 and 29: (In millions of dollars)Annual Bala
Page 30 and 31: Based on the Comparable forward P/E
Page 32 and 33: occurred because their Book Value a
Page 34 and 35: Sensitivity Analysisg0 0.02 0.03 0.
Page 36 and 37: on those obligations. This valuatio
Page 40 and 41: Net Profit Margin 4/3/2004 3/29/200
Page 42 and 43: Return on Equity (ROE) 4/3/2004 3/2
Page 44 and 45: Quick Ratio 4/3/2004 3/29/2003 3/30
Page 46 and 47: Discounted Dividends (Amounts in mi
Page 48: Residual Income 1 2 3 4 5 6 7 8 9 1
Page 51 and 52: 51Polo Ralph Lauren Corp.As Reporte
Page 54 and 55: 54Polo Ralph Lauren Corp.As Reporte

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