Computer Project _3 comparative analysis

Computer Project _3 comparative analysis - H ome Depot vs....

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Home Depot vs. Lowes Financial Comparative Analysis Prepared By: Rachel L. Gates When comparing the two highly established companies, Home Depot, Inc. and Lowes Companies, Inc., the findings were heavily weighted in favor of Home Depot. Home Depot prevailed over Lowes in four out of five financial categories. The comparative analysis involves Return on Equity, Price / Earnings Ratio, Net Profit Margin, Earnings per Share, and Current Ratio. The return on equity (ROE) results reported indicates that Home Depot’s return to the common stockholders is 15.06%, clearly outweighing Lowes 9.74% results. Home Depot’s greater return demonstrates financial leverage. This Indicates that Home Depot relies more on debt than equity financing. ROE is important to recognize since it explains the amount earned for each dollar invested by stockholders. The higher the ratio means stockholders are likely to enjoy greater returns. As for the category of price / earnings ratio, this area helps investors
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Computer Project _3 comparative analysis - H ome Depot vs....

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