Chat with us, powered by LiveChat In this unit, you will provide a brief written analysis of the ratios for Mastercard.? Evaluation should be submitted in an MS Word document of no more than th - Essayabode
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08 Jul In this unit, you will provide a brief written analysis of the ratios for Mastercard.? Evaluation should be submitted in an MS Word document of no more than th

Posted at 08:40h in Finance by

 In this unit, you will provide a brief written analysis of the ratios for Mastercard.  Evaluation should be submitted in an MS Word document of no more than three pages and be concise, clear and professional. 

 

Directions

Evaluation of Mastercard should include:

  1. A discussion of the ratios calculated in relation to the respective financial diagnostic categories (profitability, liquidity, leverage, operating returns).
  2. Discuss the importance of the ratio in financial analysis.
  3. Other information pertinent to Mastercard which could affect their future performance and stock price.

Ratios

2017 2018 2019 Formulas
PROFITABILITY RATIOS
MC GROSS MARGIN 78.50% 78.50% 79.05% Gross Profit / Sales
MC OPERATION MARGIN 53.96% 56.01% 57.43% Operating Income / Sales
MC NETPROFIT MARGIN 31.33% 39.19% 48.08% Net Income / Sales
LIQUIDITY RATIO
MC CURRENT RATIO 1.57 1.39 1.42 Current Assets / Current Liabilities
MC CASH RATIO 0.67 0.58 0.59 Cash / Current Liabilities
LEVERAGE RATIOS
MC DEBT TO EQUITY 2.88 3.59 3.94 Total Debt / Value of Equity
OPERATION RETURNS
MC ROE 71.22% 108.14% 137.20% Net Income / Book Value of Equity
MC ROA 19.08% 24.32% 28.53% ( Net Income + Interest Expense ) / Book Value of Assets
*** There is no interest expense in any year

MA Income Statement

MA_IncomeStatement_Annual_As_Originally_Reported 2017 2018 2019
Gross Profit 9,810,000,000 11,736,000,000 13,346,000,000
Total Revenue 12,497,000,000 14,950,000,000 16,883,000,000
Business Revenue 15,492,000,000 18,483,000,000 20,856,000,000
Sales Return and Allowances/Discounts -5,848,000,000 -6,881,000,000 -8,097,000,000
Other Revenue 2,853,000,000 3,348,000,000 4,124,000,000
Cost of Revenue -2,687,000,000 -3,214,000,000 -3,537,000,000
Staff Cost, Cost of Revenue -2,687,000,000 -3,214,000,000 -3,537,000,000
Operating Income/Expenses -3,067,000,000 -3,362,000,000 -3,650,000,000
Selling, General and Administrative Expenses -2,631,000,000 -2,903,000,000 -3,128,000,000
General and Administrative Expenses -1,378,000,000 -1,619,000,000 -1,747,000,000
Legal, Accounting, Auditing and Consulting Fees -355,000,000 -377,000,000 -447,000,000
Selling and Marketing Expenses -898,000,000 -907,000,000 -934,000,000
Staff Costs 0 0 0
Depreciation, Amortization and Depletion -436,000,000 -459,000,000 -522,000,000
Depreciation and Amortization -436,000,000 -459,000,000 -522,000,000
Provision Expense/Write-Back
Provision for Doubtful Accounts
Total Operating Profit/Loss 6,743,000,000 8,374,000,000 9,696,000,000
Non-Operating Income/Expenses, Total -221,000,000 -1,170,000,000 35,000,000
Total Net Finance Income/Expense -154,000,000 -186,000,000 -224,000,000
Net Interest Income/Expense -154,000,000 -186,000,000 -224,000,000
Interest Expense Net of Capitalized Interest -154,000,000 -186,000,000 -224,000,000
Interest Income
Net Investment Income -50,000,000 158,000,000 232,000,000
Gain/Loss on Investments and Other Financial Instruments 167,000,000
Gain/Loss on Foreign Exchange -106,000,000 36,000,000 -32,000,000
Other Investment Income 56,000,000 122,000,000 97,000,000
Irregular Income/Expenses -15,000,000 -1,128,000,000 0
Litigation Income/Expense -15,000,000 -1,128,000,000 0
Other Income/Expense, Non-Operating -2,000,000 -14,000,000 27,000,000
Pretax Income 6,522,000,000 7,204,000,000 9,731,000,000
Provision for Income Tax -2,607,000,000 -1,345,000,000 -1,613,000,000
Net Income from Continuing Operations 3,915,000,000 5,859,000,000 8,118,000,000
Net Income after Extraordinary Items and Discontinued Operations 3,915,000,000 5,859,000,000 8,118,000,000
Net Income after Non-Controlling/Minority Interests 3,915,000,000 5,859,000,000 8,118,000,000
Net Income Available to Common Stockholders 3,915,000,000 5,859,000,000 8,118,000,000
Diluted Net Income Available to Common Stockholders 3,915,000,000 5,859,000,000 8,118,000,000
Non-Controlling/Minority Interests
Reported Total Revenue 12,497,000,000 14,950,000,000 16,883,000,000
Reported Operating Expense -5,875,000,000 -7,668,000,000 -7,219,000,000
Reported Total Operating Profit/Loss 6,622,000,000 7,282,000,000 9,664,000,000
Reported Normalized Income 4,906,000,000 6,792,000,000 7,937,000,000
Reported Effective Tax Rate 0 0 0
Reported Normalized Operating Profit
Basic EPS 3.67 5.63 7.98
Diluted EPS 3.65 5.60 7.94
Basic WASO 1,067,000,016 1,041,000,015 1,017,000,015
Diluted WASO 1,072,000,016 1,047,000,015 1,022,000,015
Fiscal year ends in Dec 31 | USD

MA Balance Sheet

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MA_BalanceSheet_Annual_As_Originally_Reported 2017 2018 2019
Total Assets 21,329,000,000 24,860,000,000 29,236,000,000
Total Current Assets 13,797,000,000 16,171,000,000 16,902,000,000
Cash, Cash Equivalents and Short Term Investments 7,782,000,000 8,378,000,000 7,676,000,000
Cash and Cash Equivalents 5,933,000,000 6,682,000,000 6,988,000,000
Short Term Investments 1,849,000,000 1,696,000,000 688,000,000
Available-for-Sale Securities, Current 1,849,000,000 1,696,000,000 688,000,000
Held-to-Maturity Securities, Current
Cash Restricted or Pledged, Current 1,631,000,000 1,633,000,000 1,954,000,000
Trade and Other Receivables, Current 3,344,000,000 4,728,000,000 5,509,000,000
Trade/Accounts Receivable, Current 3,344,000,000 4,728,000,000 5,509,000,000
Taxes Receivable, Current
Other Receivables, Current
Prepayments and Deposits, Current 77,000,000 51,000,000 105,000,000
Other Current Assets 963,000,000 1,381,000,000 1,658,000,000
Deferred Tax Assets, Current
Deferred Costs/Assets, Current
Total Non-Current Assets 7,532,000,000 8,689,000,000 12,334,000,000
Net Property, Plant and Equipment 829,000,000 921,000,000 1,828,000,000
Gross Property, Plant and Equipment 1,543,000,000 1,768,000,000 2,928,000,000
Properties 621,000,000 696,000,000 808,000,000
Buildings and Improvements 455,000,000 481,000,000 505,000,000
Leasehold and Improvements 166,000,000 215,000,000 303,000,000
Machinery, Furniture and Equipment 81,000,000 85,000,000 92,000,000
Furniture, Fixtures and Office Equipment 81,000,000 85,000,000 92,000,000
Other Equipment 0 0 0
Leased Property, Plant and Equipment 810,000,000
Other Property, Plant and Equipment 841,000,000 987,000,000 1,218,000,000
Accumulated Depreciation and Impairment -714,000,000 -847,000,000 -1,100,000,000
Accumulated Depreciation -714,000,000 -847,000,000 -1,100,000,000
Net Intangible Assets 4,155,000,000 3,895,000,000 5,438,000,000
Gross Goodwill and Other Intangible Assets 5,312,000,000 5,070,000,000 6,734,000,000
Goodwill 3,035,000,000 2,904,000,000 4,021,000,000
Intangibles other than Goodwill 2,277,000,000 2,166,000,000 2,713,000,000
Software and Technology 1,572,000,000 1,514,000,000 1,884,000,000
Customer Relationships 648,000,000 606,000,000 785,000,000
Other Intangible Assets 27,000,000 46,000,000 44,000,000
Trademarks and Patents 30,000,000
Accumulated Amortization and Impairment -1,157,000,000 -1,175,000,000 -1,296,000,000
Accumulated Amortization of Intangible Assets -1,157,000,000 -1,175,000,000 -1,296,000,000
Accumulated Amortization of Intangibles other than Goodwill -1,157,000,000 -1,175,000,000 -1,296,000,000
Accumulated Amortization of Software and Technology -888,000,000 -898,000,000 -988,000,000
Accumulated Amortization of Customer Relationships -214,000,000 -232,000,000 -264,000,000
Accumulated Amortization of Other Intangible Assets -26,000,000 -45,000,000 -44,000,000
Accumulated Amortization of Trademarks and Patents -29,000,000
Total Long Term Investments 249,000,000 337,000,000 914,000,000
Investment in Financial Assets, Non-Current 249,000,000 337,000,000 914,000,000
Equity Securities/Shares, Non-Current 249,000,000 337,000,000 914,000,000
Financial Investment Securities, Available-for-Sale & Held-to-Maturity, Non-Current
Available-for-Sale Securities, Non-Current
Held-to-Maturity Securities, Non-Current
Trade and Other Receivables, Non-Current 178,000,000 298,000,000 460,000,000
Taxes Receivable, Non-Current 178,000,000 298,000,000 460,000,000
Deferred Tax Assets, Non-Current 250,000,000 570,000,000 543,000,000
Other Non-Current Assets 1,519,000,000 2,668,000,000 3,151,000,000
Prepayments and Deposits, Non-Current 352,000,000 0
Prepayments, Non-Current 352,000,000 0
Deferred Costs/Assets, Non-Current
Total Liabilities 15,832,000,000 19,442,000,000 23,319,000,000
Total Current Liabilities 8,793,000,000 11,593,000,000 11,904,000,000
Payables and Accrued Expenses, Current 6,916,000,000 9,064,000,000 9,606,000,000
Trade and Other Payables, Current 2,470,000,000 2,884,000,000 3,535,000,000