One can see that Disney and Time Warner are closely related, however they have many differences. The gross profit margins for the companies are very similar showing that both firms are financially healthy by realizing the revenue left over accounting for the cost of goods sold.
Operating expense is very high for Disney, thus resulting in my solution of creating more efficient price conscious ways of operating their business. Time Warner operating expense ratio may be lower, although they could also use some improvements with efficiency in the operating portion of their corporation.
Disney succeeds in generating more invested capital, although it may not show to be a large return, the managerial staff as shown to make wise choices on where to focus large investments.
Disney has…
Time Warner’s dividend yield is 0.8% higher than Disney’s showing that they pay higher dividends relative to their share price.
Investors may also like Time warner in this situation as they need to spend less money relative to how much the company will make. Investors in Time Warner pay close to $15 in order to receive one dollar of company earrings. Thus, attracting more investors toward Time Warner inc. over The Walt Disney Company.
Now seeing all the portability ratios of both companies, one is able to realize that Disney is a more profitable company. Showing investors that Disney is a smart investment as they are able to pay off debts, as well as become more innovative due to the disposable income Disney may have.
The use of the debt ratio, Disney is able to show investors that they have the least amount of assets that are financed by debt. This can make investors lean towards Disney as they have lower financial risk. However, some may see a higher debt ratio as good because the company is able to have more extra money to spend, thus making more money in the…
