Financial Analysis of Target and Walmart

Running head: FINANCIAL ANALYSIS OF TARGET AND WALMART

Financial Analysis of Target and Wal-Mart

Financial Management

Strayer University

Financial Analysis of Target and Wal-Mart

The purpose of this report is to provide a financial analysis of the Wal-Mart and Target. In this paper, a comparison of both companies’ financial ratios will examine from the previous three years. In addition, an analysis of the companies’ stock will be presented and discussed.

Wal-Mart Business Summary & Financial Health

Wal-Mart Stores operates retail stores in various formats around the world. In the United States, Wal-Mart’s operation includes discount stores, supercenters, neighborhood markets, market-side, and Sam's Clubs. Its international division consists of operations in Argentina, Brazil, Canada, Chile, China, Costa Rica, El Salvador, Guatemala, Honduras, India, Japan, Mexico, Nicaragua, Puerto Rico and the United Kingdom. The company is headquartered in Bentonville, Arkansas and employs 2.1 million people to include full-time, part-time and seasonal employees (Walmart.com, 2010).

The business operation of Wal-Mart is increasing continuously, which is causing an increase in the financial performance of the business. For the year ended January 31, 2000, Wal-Mart income increased by 8.5% to 14.93 billion from 13.75 billion a year ago. The company net income increased by 6.8% to 14.85 billion $13.90 billion in the year prior. Revenues were US$408.21 billion, up 0.9% from US$404.37 billion the year before. Operating income was US$23.95 billion versus $22.80 billion in the prior year, an increase of 5.1%. Direct operating expenses rose 0.2% to $304.66 billion from $304.06 billion in the comparable period the year before. Indirect operating expenses increased 2.7% to $79.61 billion from $77.52 billion in the equivalent prior-year period (www.mergent.com).

Target Business Summary & Financial Health

Target Corporation is a retailer...