Adidas is the biggest footwear company and after analyzing the ratios it has performed as well as Nike over the years, even though it is far behind Nike in terms of revenue and profits. The share price of Adidas is currently at 4877.0 compared to the opening price of 4864.0 that was a 44.0 change-0.90%. The highest it has been is 4916.0, which I would guess is cheaper than Nike. However, does the price of Adidas worth its value and most importantly if I was to buy shares from Nike for Zinc PLC I would look at all departments of ratios I used, here I would look at all the ratios I used and possible ratios I could use. Adidas has performed consistently well in solvency and beaten Nike in the productive side of some parts of the current ratio where as in the year 2000 Adidas recorded figures of 2.04:1 compared to the modest 1.7:1 of Nike in that year.
[...] Some 1996 financial ratios are as follows): But all this is of 1996 as you can see in the application and analysis section the current ratio for the year 1999 is considerably different as it comes out as 2.3 where as the current ratio in 2000 worked out at 1.7 :1. The current ratio in 1999 has better figures then 2000 because there was far more current assets- then current liabilities- where as in comparison to 2000 the current assets was at to current liabilities. [...]
[...] I found out that the ratios don't look at quantity, but rather quality of solvency, profitability and performance shown by Nike's defeat to Adidas in some areas, even though it would have bigger values. I'm now going to look at the technical department of Nike to prove if it is really worth taking shares from . -Industry: - Nike belongs to non rubber footwear industry. The Athletic footwear industry is highly competitive. The market share data shows Nike and Adidas as the major players in the industry. [...]
[...] -Recent Financial condition:- The net income most recently for Nike in 2001 was $ 97.4 million, a 33% decrease from 2000 earnings of $ 145.3 million. Revenues were essentially flat with prior year, gross profit declined and selling and administrative expenses increased 4%. The revenue and gross margin might of been affected by lower demand in the US footwear business, supply chain disruptions, and the weakness of the euro against the US dollar. Thereby meaning the same fate for the likes of Adidas and Reebok. [...]
[...] As you can see from the analysis on the ratios that Nike financial qualities lie on innovating new ideas by branding, endorsing and advertising their products making it far popular then nearest rivals such as Adidas and Reebok, which don't have as consistently good sales. From this you can see how strong Nike is not only financially, but also in all departments including brand, culture and advertising. Therefore, putting it way ahead of rival competitors including Adidas and Reebok. So I would recommend taking shares from Nike rather than Adidas because of the past success on sales, knowing that it would only get better in the future. [...]
[...] This gives gross profit, which should be similar from year to year or better and Nike improved from 1999, where as Adidas dropped While Adidas defeats Nike in gross profit, Reebok's gross profit was The operating profit margin can be calculated the same way as gross profit and is what remains from sales revenue after deduction of all operating costs, including overheads. The net profit for Nike in 2000 was compared to for Adidas and again the higher the better. [...]
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