Executive Level Report - Financial Analysis of AMD Research Paper

executive Level Report - Financial Analysis of AMD - Research Paper ExampleThis report is structured in such a manner that first partition of this report describes brief description of the connection which includes its history, likeness of the company with its industry and the ratio epitome with some other pecuniary indicators. Section two in the main describes the stock exercise of the company which emphasizes upon the fluctuations in the share prices along with the earning and dividends analysis of AMD. Recommendation is the snuff it section which briefly in high spiritslights as whether HTC should go for making long-term contracts with AMD or not in the light of fiscal analysis conducted above. Description of Company Advanced Micro Devices (AMD) is a listed entity in New York Stock substitution (NYSE AMD). The company started off its operations in 1969. The company mainly deals in semiconductor industry such that it manufactures microprocessors which are used in compute rs, mobile phones, tablets, gaming consoles, networks etc. Financial Ratio Analysis The beat way to assess the financial performance of any company is to make a financial analysis of the company through ratio analysis as it covers most of the parts of the financial statements in a very comprehensive and meaningful form. Under the following paragraphs, the ratio analysis of AMD is conducted in which the financial performance of AMD is analyzed and compared with that of the industry middlings and its own previous years performance in respect of liquidity, improvementability and force of the company. Liquidity Analysis The up-to-the-minute ratio describes as in order to pay a current liability of $1, how much current assets the company has. Overall, the current ratio of the company has increase from 1.07 to 2.15 i.e. it has become retell in three years. The company still way behind from the industry average which has been approximately 3.4 in the last three years. If the stock i s ignored from the current assets of the company, then the quick ratio of the company has similarly become quite strong increased from 0.64 to 1.65 such that it is heading toward the industry ratio of 1.84 quite smoothly. leverage Analysis As far as the financial leverage of AMD is concerned, it can be observed that the financial leverage of the company has dropped from 14.01 to 4.9 in the 2009 and 2010. But the financial leverage of the industry is still quite high and moves around 15. The debt ratio of the company has decreased from 6. 56 to 2.16 which is a very good as the company has become less risky but still the company is quire risky as compared to the industry average which is still below 0.5 cumulatively in the three years. Efficiency Analysis Efficiency ratios mainly move the movements of particular current assets and liabilities which include receivables, inventory and payables. The average collection period of the company has increased from 30 days to around 48 days i n the last three years. The industry average revolves around 49 days. This suggests that the companys performance has remained consistent with that of the industry. Inventory turnover of the company has also increased such that it has increased from 4.72 to 5.89, which is still lower than the industry averages of 7 to 8 turnovers per year in last three years. Profitability Analysis Profitability is the core area in which every stakeholder to the company is outright involved. Mainly three profitability ratios have been analyzed which are return on sales (net profit margin), return on assets and