Hamlet and the Oedipus Complex Free Essays

Wordsworth present his perspectives on youth and child rearing, from numerous points of view, for example, language, structure and structure. He depicts kids as the encapsulation of blamelessness while he portrays grown-ups as the embodiment of experience. His sonnets had set the establishments of youth and child rearing. We will compose a custom exposition test on Think about the sonnets for youth and child rearing or then again any comparable theme just for you Request Now The three principle sonnets that show this are: The Idiot Boy, We are Seven and Anecdote for Fathers. Wordsworth utilizes The Idiot Boy to pose the peruser two inquiries. The principal respects the happenings of his creative mind particularly what occurred around evening time and the second respects of his inventive experiences. Wordsworth does this purposefully, to show that youngsters utilize their creative mind to keep themselves involved, additionally he may have needed to show that their creative mind was one of the keys to a cheerful future or their character. Wordsworth investigates various perspectives of both the mother and the child. The mother is appeared through the language utilized. She encounters a scope of feelings: presumptuousness, uncertainty, dread and tension. Be that as it may, when we contrast her with her child, who is intellectually debilitated he stays cheerful, blameless, inventive and closer to nature than even his mom he stays unperturbed. The rhyming plan is first settled after the first refrain, abccb, it includes pace and anticipation and it supports a feeling of satire. Wordsworth doesn’t just utilize this rhyming plan to include a feeling of parody, however it resembles a nursery rhyme, so it very well may be charming and reasonable to everybody. Wordsworth depicts the mother as somebody who is mindful, additionally somebody Wordsworth would trust as she would ensure her adored one. The language of the sonnet is sure as Wordsworth utilizes words, for example, â€Å"glee† and â€Å"merry†. These descriptive words give a feeling of expectation and regard towards Johnny. In this manner Wordsworth needs to depict youngsters as an unadulterated being, somebody you should not discolor with rationale or even instruction, as they will take in their insight from the best educator; creative mind or nature. Another sonnet, where the perusers see Wordsworth passing on his perspectives on adolescence and child rearing is in We are Seven, this sonnet is marginally extraordinary contrasted with the other Wordsworth sonnets, as we see two points of view on death, one by the young lady and another by the oblivious storyteller who could be a dad, from the outset until he is educated by the young lady. It is organized in four areas, Verses 1-3-are about the young lady and her scene, refrains 4-9-are illustrating her family foundation and her reaction to the narrator’s enquiry. Sections 10-15 are a rounding out of her cryptic answer about her life and the passing of her kin. The deadlock between these two is energized and dug in positions. Wordsworth utilizes his language, to make the young lady and the storyteller take an alternate perspective on death, the girl’s language is clearly taken from the mother and it is metaphorical: â€Å"released from her pain† and â€Å"[John] had to let go†. This passes on the agony the young lady needed to endure; she is attempting to facilitate her torment and attempting to cause the peruser to endure less. Wordsworth is indicating that kids are learned. Be that as it may, she doesn't care for the reality of death by any stretch of the imagination, as it disheartens her. She despite everything keeps the memory of her friends and family, which is just found in youngsters instead of grown-ups. Wordsworth misleadingly utilizes basic methodology in language and structure, the artist has proposed that we can share and acknowledge the puzzle of this young’s young lady see. Wordsworth makes this sonnet increasingly like a nursery one with the utilization of inner rhyming, for example, â€Å"green† and â€Å"seen†. It is written in quatrains comprising of 3 lines of rhyming tetrameter and a last line which is a versifying trimester, the state of mind is a sing-tune. This makes the sonnet more towards the kid and Wordsworth is attempting to introduce her as a solid character. He depicts the storyteller as a minister, something Romantics despised. As he attempts to compel his strict lessons upon everybody, anyway the jobs are traded, the young lady is instructing him, that he should think about everybody except particularly kids, as they are on the whole people, who ought not be demolished by rationale and judiciousness. Like We are Seven, Anecdote for Fathers investigates the idea of insight in youngsters and grown-ups. Additionally it is written in quatrains with 3 versifying tetrameters and a last versifying trimester, rhyming abab. It likewise, similar to We are Seven, urges us to see the dad incidentally and to see his cross examination of his child, something started â€Å"in very idleness†, as a grown-up guilty pleasure, either to fill a second or to childishly concentrate on his own suppositions and feelings. Despite the fact that the kid reacts nonsensically, it depicts to us the emotions that Wordsworth may have had during his adolescence, as the youngster doesn’t realize how to react to the dad it’s very hard for him. The kid is enduring because of his father’s modification of temperament or his mind boggling feelings that are obscure to the kid. The sonnet differentiates the skepticism and narrow-mindedness of the dad with the physical and mental immaculateness of the kid. Time is good for nothing at any rate to a child’s short presence and the sonnet delineates how kids are debased by society and grown-ups. Wordsworth is inferring that we ought not constrain rationale and reasonability on our kids, as we should regard their emotions: we are not no different and that is the way in to the secret and magnificence of life. In the last section it tends to be seen that the dad is the ‘child of the man’. The youngster can be viewed as an image of nature, which is normal in the three sonnets of Wordsworth. Generally it very well may be stated, that Wordsworth sees a pessimistic perspective towards guardians, yet not towards the mother. It very well may be additionally said that the storyteller and the dad are both male, he could be viewed as very enemy of male. He considers youngsters to be somebody we should gently fare thee well, as they are our future’s age and satisfaction. Step by step instructions to refer to Compare the sonnets for adolescence and child rearing, Papers

Do Drugs Cause Youth Violence Essay Example For Students

Take Drugs Cause Youth Violence Essay Take Drugs Cause Youth Violence?I accept that adolescent viciousness in America is to some degree because of the utilization of medications, however not so much. Despite the fact that medications are known to evoke fierce conduct, I don't accept they are the courses of savagery among American teenagers. I imagine that children can be fierce with the nonappearance of medications. While affected by liquor, one can't comprehend the distinction between what's up and what is correct. They accept they are at a considerably more remarkable level that they really are. Feelings are significantly more noticeable after somebody has been drinking, and this may prompt irregular upheavals upon any one close. Ive saw mysterious individuals from my family perform comparative acts. The more perilous of medications, for example, meth-amphetamine , heroin, L.S.D, P.C. In light of the data Ive assembled, I feel that around 30% of youth savagery in America are associated with medicate use here and there. All and All I accept savagery among kids is to a greater extent an emotional wellness or house hold related issue as opposed to with medicate use. Im not advancing medications or anything, I just dont think they are associated. As I would see it, I dont think it truly matters whether medications are legitimized. Regardless of what occurs, individuals will consistently be ingesting medications. Its all the more an individual choice than everything else, I mean there is no law expressing you can't cut yourself. Be that as it may, when somebody is at the phase when the individual is jeopardizing others and not themselves is the point at which it turns into a main problem. The most ideal way I accept medications ought to be managed is equivalent to liquor. On the off chance that individuals need to hurt themselves, that is their concern. Book index www.encyclopedia.com Medications and children today by pete anderson americas youth by scratch fergison .

Pow the Egg

A rancher is taking her eggs to the market in a truck, yet she hits a Pothole, which thumps over all the compartments of eggs. At the point when she put the eggs in gatherings of two, three, four, five, and six there was one egg left finished, yet when she put them in gatherings of seven they wound up in complete gatherings without any eggs left finished. Presently she has to know what number of eggs she had and is there more than one chance. The principal thing I did was to peruse the pow maturing all alone. I out when she put her eggs in gatherings of two there is one remaining over.The number can't be a various of two. Likewise three four five and six can’t be a numerous of this number. In the event that there were no eggs left over when placed into gatherings of seven there more likely than not been a different of 7 eggs. Presently need to discover products of seven. 7,14,21,28,35,42,49,56,63,70,77, 84,91,98, 105,112,119,126,133,140,147 ,154,161,168,175,1 82 ,189,196 ,203 ,210, 217, 224, 231 ,238, 245, 252 ,259, 266, 273, 280,287,294,301 Then you cross out all the numbers that are separable by 2,3,4,5, and 6.So I got161 and 301 as the numbers that can't be products 2, 3,4,5,6. | 3 * 4 * 7 = 8449 + 84 = 133. Nothing worth mentioning. 133 isn't acceptable in light of the fact that it's anything but a different of 7133 + 84 = 217. Nothing more than a bad memory. 217 on the grounds that it's anything but a different of 7217 + 84 = 301. Good| | I got 301 on the grounds that you get a rest of 1 for the numbers: 2,3,4,5 and 6. So the most modest number of eggs is 301. Be that as it may, there is other arrangement. Be that as it may, as a rule what you're searching for is the littlest arrangement, so 301 is most likely the appropriate response you want.One day a kid was heading off to the b-ball court he had six arrangements of balls. At the point when he was arriving he stumble on a stone letting all the ball dropping out the net. Presently he needs to esta blish out what number of balls were in the nets. He know when he put the balls in bunches two, three, four, five and six three was one ball left finished, however when she put them in gathering of seven they end up a total gatherings without any eggs left finished. This issue was alright however sort of hard. In the event that I got more assistance on it perhaps I would have an all the more comprehension of the issue

Joseph Stalin and First Five-Year Plan Essay

Dynamic The chronicled extent of this exploration paper centers around the strategies embraced by Joseph Stalin in industrializing the Soviet Union through his First Five-Year Plan. Along these lines, the fundamental inquiry emerging all through this exposition is the accompanying: To What Extent Were Joseph Stalin’s Methods In Employing The First Five-Year Plan (1928-1932) Effective In Achieving His Original Industrial Aims? So as to have the option to break down such questionable point, the paper first tends to how Stalin moved toward the thought for financial development, for the most part by utilizing three techniques: concentrated, mandate arranging, use of political publicity crusades, and an emphasis on overwhelming industry. The aftereffects of industrialization are then broke down and contrasted with the initially proposed destinations. A significant part of the examination led depended on essential wellsprings of proof just as optional sources that most precisely portrayed t he circumstance of the Soviet Union at that point and its encouraging through the predetermined timespan of the Stalin organization. Investigation of such archives was additionally required so as to effectively conclude the believability and legitimacy of the proof introduced so as to have the option to put together the ends with respect to the data. In conclusion, the utilization of historians’ understandings was utilized so as to validate guarantees or give accommodating elective perspectives. This examination paper along these lines inferred that, in spite of the fact that he did figured out how to grow tremendously interest in industry and power the country out of its regressive, agrarian state, Stalin didn't accomplish far reaching industrialization for the Soviet Union. Basically, the profound bureaucratization of the economy, working together with the specific highlights of the Soviet arrangement, delivered a mix of opposing powers starting from bureaucratic personal matters and indiscreet political will. This would forestall the development of the correct blend of elements that would guarantee the ordinary working of the economy. List of chapters Dynamic â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€2 Abbreviations and Glossary â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€ 4 Introduction â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€- 5 Stalin’s Realization for Industrialization 1. Clarifying the Five-Year Plan (1928 †1932) â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€- 7 Analysis of Soviet Model of Industrialization under Stalin 1. Stalin and Centralized Directive Planning â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€ 9 2. Stalin and Political Propaganda Campaigns â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€- 10 3. Stalin and Focus on Heavy Industry â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€- 13 Results of First Five-Year Plan 1. Improvement of Overall Industrial Sector â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€- 10 Conclusion â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€- 17 Notes â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€- Bibliography â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€â€19 Shortened forms and Glossary 1. 2. Focal Committee: Soviet Communist Party incomparable body, chose at Gathering Congress. 3. Gosbank: Gosudarstvenny bank SSSR (USSR State Bank); Soviet Union national bank and the main bank in the whole USSR from the 1930s until 1987. 4. Gosplan: Gosudarstvenniy Komitet po Planirovaniyu (State Planning Committee); board of trustees liable for financial arranging in the Soviet Union. One of its primary obligations was the formation of Five-Year Plans. 5. Gossnab: State Supplies of the USSR; the state board of trustees for material specialized gracefully in the Soviet Union. Principally liable for the allotment of maker products to undertakings, a basic state work without business sectors. 6. Gulag: Glavnoe Upravlenie Lagerei (principle camp organization); inevitably accountable for Soviet death camps. 7. Mensheviks: Minority group of the RSDLP, established in 1903 8. NEP: New Economic Policy (1921-1929) presented by Lenin. 9. Pravda: the semiofficial paper of the Communist Party Presentation In October 1928, Joseph Stalin(1) executed the First Five-Year Plan (piatiletka) so as to reinforce the economy of the Soviet Union and quicken its pace of industrialization. Some portion of a progression of across the nation, brought together activities in quick financial turn of events, the First Five-Year Plan would turn into the reason for future in general modern creation and improvement of overwhelming businesses (assembling and military goods).(A) Since the finish of the First Five-Year Plan, in any case, various records have surfaced either lauding or condemning Stalin’s model of monetary development (contingent upon the interpreter’s preference of results) comparable to the Soviet Union’s future turn of events. Albeit current history specialists, including Evan Mawdsley(2) and Robert Gellately(3), banter over the degree of Stalin’s achievement in accomplishing the first points of the First Five-Year Plan, most of them will concur that he accompl ished a huge and basic increment in mechanical development that would at last hoist the Soviet Union as a world class power. (E) Nevertheless, because of the shakiness of essential assets beginning from Soviet files and repeating banters among students of history, a few troubles keep on existing in precisely characterizing the degree of Stalin’s achievement and whether his techniques were appropriate in utilizing the First Five-Year Plan most successfully. Supporters of Marxism-Leninism attest that the coercive and rough strategy in accomplishing significant industrialization was the most fitting and essential in both the financial and social modernization of the USSR just as fundamental for its endurance despite entrepreneur â€Å"enemies†. Be that as it may, Non-Soviet Marxists, from Mensheviks to Herbert Marcuse(4), reprimand this methodology for its drawn out unfavorable impacts on the economy and average workers, just as the significant imprint on the Soviet social life and standard of living.(F) Therefore, a basic assessment of the different scope of recorded translations and examinatio ns concerning this dubious subject should along these lines be led, making the subject of Soviet industrialization deserving of examination. This examination paper, regardless of the restricted accessibility of Soviet essential sources and their questionable believability, will along these lines endeavor to respond to the accompanying inquiry: To What Extent Were Joseph Stalin’s Methods In Employing The First Five-Year Plan (1928-1932) Effective In Achieving His Original Industrial Aims? Along these lines, significant knowledge into historians’ strategies in consolidating proof to help their cases and building their contentions dependent on such proof will be picked up. So as to keep up lucidity and center, this examination paper will basically talk about industrialization and will in this manner rotate around two subjects: First, the Soviet model of mechanical progression was not far reaching and its accomplishments can just by ascribed and constrained to specific parts. Second, the techniques utilized by Stalin to accomplish industrialization and financial modernization were unsteady and blocked total acco mplishment of the proposed objectives. Stalin’s Realization for Industrialization Clarifying the First Five-Year Plan (1928-1932) It is critical to initially increase a comprehension of what Josef Stalin’s First Five-Year Plan involved and what he planned to achieve in the modern segments before the finish of the multi year time span. The last methodology will empower a certified investigation looking at how the aftereffects of the arrangement contrasted with the initially settled destinations, in this way, giving the fundamental viewpoint in assessing Stalin’s techniques for financial reconstruction. In October 1928, Stalin joined the Soviet diagram for the organization of communism in the First Five-Year Plan, speaking to the primary endeavor by a significant capacity to change all parts of economy and society. This new Soviet procedure concentrated fundamentally on setting up an overwhelming mechanical part to speed up the development of fabricated items and weapons just as reproducing the rural area on another specialized foundation.(G) This woul

Understanding the Relationship between Alexithymia and Self-Harm - Free Essay Example

I. Background and Rationale a) Introduction Self-injurious behaviors are a concern among young adults and require a better discernment of hazardous aspects and pathways to these occurrences (Anestis et al., 2009). These young adults predicate that their self-inflicted acts, involving low lethality methods such as burning skin or skin cuts, are not suicidal. Developmental psychopathology models have processes and proposed mechanisms through which hostile caregiving environments or childhood ill-treatment experiences can lead to engagement in non-suicidal acts (Roemer et al., 2009). Frameworks reiterating the foundations of the interpersonal rate of affectedness assumes that hostile caregiving environments and consequent insecure attachments are associated with slow development, this inhibits or stimulates dealing with emotional afflictions. b) Study Rationale Research which was done to determine insecure attachments, emotion regulation deficits, and non-suicidal self-injury have been limited and inconsistent. Well-developed theoretical and conceptual models (Hayes et al., 1996) should be the focus. There has been consistent evidence for destructive patterns of emotion regulation among self-injuring youth and greater self-reported emotional reactivity (Gratz, 2007) when subjected to stimuli. Self-injury is also found to be a means to regulate negative emotions. II. Discussion a) Attachment The role of attachment disorder is relatively established; the limitation is the scarcity of research in the specific attachment triggers that increase the vulnerability for self injury. there is less clarity on the specific attachment trigger which increases the vulnerability for self-injury. Higher attachment anxiety has been implicated among self-injuring adult psychiatric inpatients, but other research reported an association between withdrawn attachment and self-injury among individuals with personality disorder. Despite the growing interest in understanding the antecedents and risk factors connected to (NSSI), studies that examine both attachment disorder and emotion regulation difficulties are scarce. High self-esteem and the ability to adjust psychologically are firm indicators of positive emotional intelligence, whereas factors such as depression, distressing and harmful behavior are proponents of negative or low emotional intelligence (Hazan Shaver, 1987). There ex ists a strong positive correlation between emotional intelligence and mental challenges as evidenced by (Aleman swart, 2009), The positive quality of life brought about by higher emotional intelligence and consequently mental conditions such as psychopathology tend to develop among individuals due to low emotional intelligence. b) Theories Theories in behavioral patterns of psychopathology indicate the importance of problematic behavior functions (Fischer et al., 2004). NSSI is influenced by emotional personality, regulation and stimulation. Emotions which include frustration, anxiety, and anger tend to predate NSSI, which is usually followed by feelings of serenity and relief but leads to despair and disgust in the long run (Manwaring et al., 2006). In a study psychology setup, male prisoners with a history of self-violence were observed to determine the prevalence of emotional feedback about self-harm. When correlated with the control group, self-harm volunteers responded with a reduction in physiological stimulation as well as repugnant emotion to images of self-harm, contrary to neutral situations and injuries which are accidental. Individuals with emotional disorder are likely to cause bodily harm, and could be used to explain the susceptibility for those with high alexithymia attempt such acts (Bishop et al. , 2004). Several emotional therapy models have been designed to reduce the susceptibility to self-harm (Gratz, 2007) and, individuals that have been found to show emotional instability were said to be suffering from high alexithymia (Stasiewicz et al., 2012; Taylor, 2000) and be likely to use suppressed regulation techniques than positive strategies. Authors conclude that alexithymia is an acquired strategy to avert overwhelming emotions. According to Chapman and Brown (2006) prevention of emotion can be prevented through identification of self-harm as a channel for warding off feelings. Therefore, it is justified to state that the mechanism that sheds light on the relationship between alexithymia and self- harm is experiential prevention. Conclusively, it is concise to propose that low childhood attachments are a determining factor in the progression and development of alexithymia and self- harm as stated by Oskis et al, (2013) and Van der Kolk, Perry, and Herman (1991). Fina lly, poor childhood attachment is a causal factor in the development of alexithymia (Oskis et al, 2013) and self-harm (Van, Herman Perry, 1991). Identifying a feeling subscale of TAS20 is closely related to the fear of seclusion, following a study conducted by Oskis et al, (2013) on adolescents. It is a plausible assumption to indicate poor attachment as a subliminal reason for the preventive behavior noticed in individuals with a higher level of alexithymia and self-harming behaviors. III. Conclusion Despite the fact that many of these factors have been quantified and contrasted bilaterally in the literature, a bonding agent is lacking, to bind them together to fully grasp the mechanisms by which alexithymia might be related to self-harm (Chambers et al., 2009). The present review is directed towards a test model in which alexithymia separates them from self-harm. The dearth of reliable and concise evidence of the relationship between NSSI and alexithymia has left some of studies that evaluated the function of emotional response as well as the capacity to comprehend and show emotional states in adolescents who inflict self-harm. References D.J Lyddon, W Schreiber, Alford, (2006). Emotion working models of adult attachment. Psychology quarterly. Fink, E. L., Joiner, M. D. Smith, Anestis, (2009). Distress and Unregulated eating: The role of adverse urgency in clinical samples. Cognitive Therapy, 33, 390-397. Aderson. N. D.,Carmody J., Bishop, S.R., Lau, M., Shapiro, S., Carlson, L., et al., (2004) A An Operational definition proposed in clinical psychology and mindfulness: science practice, 11(3), 230-241. Gullone, G., Allen, N. B., Chambers, R., (2009). An integrative review. Emotional regulation mindfulness. Clinical Psychology Review, 29, 560-572 Fischer, S., Anderson, K. G., Smith, G. T. (2004). Coping with distress by eating or drinking: Role of trait urgency and expectancies. Psychology of Addictive Behaviors, 18, 269-274. Gratz, K. L Roemer, L. (2004). Multidimensional assessment of emotion regulation and dysregulation: Development, factor structure, and initial validation of the difficulties in emoti on regulation scale. Journal of Psychopathology and Behavioral Assessment, 26, 41-54. Hayes, S. C., Wilson, K. G., Strosahl, K., Gifford, E. V., Follett, V. M. (1996). Experiential avoidance and behavioral disorders: A functional dimensional approach to diagnosis and treatment. Journal of Consulting and Clinical Psychology, 64, 1152-1168. Hazan, C., Shaver, P. R. (1987). Romantic love conceptualized as an attachment process. Journal of Personality and Social Psychology, 52, 511-524. Manwaring, J.L., Hilbert, A., Wifley, D.E., Pike, K.M., Fairburn, C.G., Dohm, F. Striegal-Moore, R. H. (2006). Risk factors and patterns of onset in binge eating disorder. International Journal of Eating Disorders, 39, 101-107. Roemer, L., Lee, J. K., Salters-Pedneault, K., Erisman, S. M., Orsillo, S. M., Mennin, D. S. (2009). Mindfulness and emotion regulation difficulties in Generalized Anxiety Disorder: Preliminary evidence for independent and overlapping contributions. Behavior Therapy, 40, 1 42-154.

Automobile sector - Free Essay Example

1. Overview of the automobile sector Five forces analysis Competitive Rivalry between Existing Players: High Competition between existing automobile companies is high. Although the automobile market was dominated by the three big auto manufacturers in US, Toyota and Honda in Japan, the situation is changed. With the growing demand in emerging market, the emerging competitors in China and India may drive an intensified price competition. However, the competition could also focus on the safety, warranty and financial services etc. Threat of New Entrants: Medium Although the entrant barrier is high for the automobile industry because the requirement of capital and technology, an increasing number of automobile manufacturers are emerging in China and Asia due to the economic expansion and growing demand. However, these automakers are in the development status and may not catch up the leading technology in Japan and US, so the threat from new entrants is medium. Threats of Substitutes: Low Customers could choose to switch to transportation means other than automobile such as bicycles, buses and subways. However, the automobile is still the favourite despite the relevant high cost than other mentioned transportation means because its flexibility, comfort and convenience. Bargaining Power of Suppliers: Low In automobile industry, the component supplier has little bargaining power because the manufacturer could switch to other suppliers easily. On the other hand, the components are generally low value and the suppliers find it difficult to bargain with automakers. Bargaining Power of Customers: High The competition in the automobile industry is intense as mentioned above. So the customers have many choices on the brands and models. Customers care about the quality, price, safety, comfort, appearance of the car. Recently, customers are also more and more concerned about the environmental effect of the automobile and the energy efficiency. So the customers get more and more bargaining power in automobile industry. 2. Toyota Motor Company 2.1 Overview of the company Company profile Toyota Motor Corp. is one of the largest and leading automobiles manufacturers in the globe. It operates in three main business segments; the two biggest are automobile and financial services whereas the third one is comprised by many smaller other divisions. It is spread worldwide as it has 50 manufacturing facilities in 27 countries and regions Toyota designs, manufactures and sales passenger cars of several types and utilities, trucks, tractors and material handling equipment, minivans and other car accessories. Its products can be divided into 2 main categories, conventional and hybrid vehicles. The company sells its products under Toyota, Lexus, Hino and Daihatsu brands The company is also engaged in the financial industry as it provides financing to its customers and dealers. It is also involved in housing, marine, e-commercial, ITS and biotechnological activities. Toyota sells its vehicles in more than 170 countries and regions worldwide. Toyotas primary markets are Japan, North America, Europe and Asia. It is headquartered in Toyota City, Japan and employed around 316,121 people as on March 31, 2008 Strategy Analysis Toyotas strategy can be summarised under three key principles; growth, efficiency and stability. These are the three priorities the companys management will pursue to achieve future sustainable growth and increase the economic value. Growth will be achieved through continuous investment mainly in hybrid vehicle segment to meat the increasing demand. Efficiency is mainly focused on cost management and further reduction in order for the company to be able to provide high quality products in affordable prices and maintain its competitive advantages. Stability will be ensured by maintaining a solid financial base. Within the economic downturn it is important for Toyota to maintain sufficient liquidity in order to continue to finance its investments in research and development of new technologies, which is an integral and essential part of the companys advantages. Peer Group As Toyota operates in the global market its competitors come from all around the world. Its major competitors are BMW AG, DaimlerChrysler AG, Fiat S.p.A., Ford Motor Company, General Motors Corporation, Honda Motor Co. Ltd., PSA Peugeot, Renault S.A., Volkswagen AG and many others SWOT Analysis Strengths Weaknesses l Strong overall financial performance l Strong reputation and quality l Strong position is Asian market l Research and development l Production pipeline system and cost management l Diversified product portfolio l Financial services are still undeveloped l Huge expenses on pensions and post-retirement benefits Opportunities Threats l Increasing demand for hybrid and environmental-friendly cars l Expansion in emerging Asian markets l Financial and other non-auto division development l New car models l Global economic crisis l Strong competition in automotive industry l Yen and US dollar exchange rates l Tight environmental regulations on carbon emissions l Problems with specific components of sold cars. (Recent brake problem) 2.1. Key Financials Analysis 31/3/2009 31/3/2008 31/3/2007 31/3/2006 31/3/2005 Sales 207,852.40 264,120.58 202,821.01 178,294.05 173,443.60 Operating Income -4,667.52 22,809.82 18,959.84 15,919.51 15,192.39 Net Income Available to Common -4,423.79 17,259.05 13,923.62 11,629.63 10,950.45 Total Assets 292,725.95 324,979.61 275,051.76 242,604.35 227,515.08 Total Liabilities 185,398.39 199,132.47 169,488.89 148,104.55 138,230.49 Common Equity 101,865.07 119,249.79 100,242.15 89,502.94 84,563.86 Net Cash Flow Operating Activities 14,724.7 26,357.6 27,783.5 22,136.2 22,144.6 * IMPORTANT First year to report losses * Stable increase in sales Decline in 2009 greatly affects income * Severe decrease in cash flow from operating activities, nearly 50% * Very big difference between sales and operating income points out severe cost expenses for the company. As this differences is constantly increasing it is not far from the truth to say that Toyota is gradually loosing its competitive advantages in cost efficiency against its competitors. * General trend in key financial s shows a steady and permanent increase until 2008 and a sharp decline in 2009, due to severe problems of economic recession and its great impact on automobiles industry. This trend applies for almost all financial s, pointing out that the companys performance as a whole followed a movement like this. 2.3. Multiples analysis 31/3/2009 31/3/2008 31/3/2007 31/3/2006 31/3/2005 Price To Earnings -22.43 9.19 14.74 15.25 11.23 Price To Book 0.97 1.32 2.04 1.97 1.44 Price To Cash Flow 7.41 4.83 7.83 7.80 5.87 Price To Sales 0.5 0.7 0.8 1.0 0.7 * Multiples follow companys general trend, namely increase until 2007 and then decreasing sharply * Consistent with overall picture of company, multiple analysis show the economic downturn of the entity from 2007 onwards * Point to mention: negative P/E ratio. Markets expectation about company looks really slim. The economic crisis, alongside with its severe problems generating income and its recently damaged reputation, create really unfortunate future prospects for Toyota. The negative P/E ratio and specifically its magnitude (-22) implies that nobody is neither willing to pay to buy the companys share nor expecting any profit generation. * Very sharp decline as well; 31.62 units is something extremely noticeable. If we focus on decline itself, it shows an extremely quick unfavorable turn of the market towards the company. 2.4. Companys performance 31/3/2009 31/3/2008 31/3/2007 31/3/2006 31/3/2005 Profitability Return on Equity -3.98 14.49 14.68 14.00 13.60 Operating Profit Margin -2.25 8.64 9.35 8.93 8.76 Asset Utilization Total Assets Turnover 0.71 0.81 0.74 0.73 0.76 Net Sales % Working Capital 28.93 180.70 1412.62 29.78 15.30 Gearing EBITDA / Interest Expense 20.94 86.19 77.33 153.70 146.20 Long Term Debt/ Common Equit 62.63 50.40 52.92 53.41 55.44 Valuation Investment Earnings Per Share -1.41 5.43 4.34 3.57 3.32 Dividend Yield Close 3.21 2.82 1.59 1.40 1.63 Liquidity Quick Ratio 0.81 0.77 0.76 0.81 0.87 Current Ratio 1.07 1.01 1.00 1.07 1.15 * Negative profitability in 2009 * Fluctuating sales/working capital as a result of fluctuation if investments (working capital) * Gearing increase in 2009 at the same time with high decrease of interest cover * Stable and quite low liquidity 2.5. Cash Flow analysis 31/3/2009 31/3/2008 31/3/2007 31/3/2006 31/3/2005 Cash Flow Operating Activities 14,724.7 26,357.6 27,783.5 22,136.2 22,144.6 Cash Flow Investing Activities (12,265.3) (34,254.0) (32,727.4) (29,704.4) (28,591.6) Cash Flow Financing Activities 6,967.4 6,242.7 7,565.6 7,716.8 3,917.0 Effect of exchange rates -1,294.04 -749.27 218.18 604.94 232.09 Net Cash Flow 8,132.86 -2,402.99 2,839.91 753.58 -2,297.85 * Severe decrease in cash flow from operating activities, nearly 50% which vividly affects its operating income * Extreme decrease in investing activities around 70%, probably caused by cash shortage and policy change. The company issued a new project with main goal to improve profits and cover operating expenses and as a result we see a large negative impact in new investments. * Financing activities exhibit a stationary trend over the past few years indicating the stable financial policy of the entity. * Adverse effects of exchange rates during the last two years indicating the risk the company runs because of the Yens depreciation to the U.S dollar and the Euro. 2.6. Stock Performance The companys share performance seems to move according to the index, with the trend to over perform it constantly. We can see the decline of the shares price, which started right before the end of 2008, following the global economic recession. At the turning point, which is in the beginning of 2009, we observe a relatively high trading volume, probably indicating the forthcoming upward movement. It is also really significant to point out the extreme high trading volume observed during the first months of 2010, followed by a new decline of the shares price. This reflects the problems that Toyota is facing nowadays. There is a considerable lack of trust from the market towards the company which is mainly caused by its severely damaged reputation and loss of quality. 3. Ford Motor Company 3.1 Overview of the company A . Company profile The group operates in two segments: Automotive and Financial Services. For the automotive segment which consists of Ford, Lincoln, Mercury and Volvo has a main operating activity in manufacturing, sale and service of component for cars and trucks. The Financial services segment is included of financing, insurance and leasing regarding to cars, trucks, industrial equipment, construction equipment and other activities. The company has operation in North America, South America, Europe, Africa and Asia- Pacific. B. Strategy Analysis One Ford The Company has initiated the new strategy called One Ford which has detail as follow: o ONE TEAM focuses the significant of team work in order to reach the automotive leadership. The measurement is satisfactory of business partners, employees, investors, and related companies. o ONE PLAN: The four-step plan has been established which composed of: balance between cost structure and revenue; develop new product follow customer preference; develop balance sheet status and finance the plan; and cooperation around the world to leverage companys resources. o ONE GOAL: That is to create an exciting and viable company with profitable growth for all. Ford has started the restructuring business process before the economic crisis which the Company has reduced the excess capacity, closed some unprofitable plants and lower excess workforce. In addition, Ford has improved the product line in term of higher quality, more safety, use less energy and more economic. * Affordable Fuel Economy: Focusing on deliver fuel efficiency engine to the market. For example, the 2010 Ford Fusion is now Americas most fuel efficient midsize sedan for both the hybrid and conventional gasoline models. * Electrification strategy: plan to bring pure batteryelectric vehicles, next-generation hybrids and a plug-in hybrid to market quickly and more affordably over the next four years. * Safety leadership: Ford got totaling 16 models picked from the Insurance Institute for Highway Safety which more than other brands. * EcoBoost Engine: delivers significant gains in fuel economy along with a great performance drive feel. C. Peer Group Fords peer group is Daimler AG, Fiat Spa Honda Motor Company Limited, Motors Liquidation Company, Nissan Motor Company Limited, Toyota Motor Corp and Volkswagen AG. D. Fords SWOT Analysis Strengths Weaknesses l Wide geographic Operate throughout the world and has a strong market in North America, Europe and Asia. Sales of each region of 2008 are 49%, 39% and 12% respectively. The well diversified market of ford reduces the risk of economic problem in specific area. l Brand royalty Ford has renowned reputation about quality and also owns other renowned brands such as Lincoln, Mercury and Volvo. l Quality car Ford owns totaling 16 models of car that rated as safety car by the Insurance Institute for Highway Safety l Product Recall Experienced many recalled products due to the quality of defective cruise control switch which may cause fire. Even though there is no fire cases reported but the Companys reputation is negative affected. l Negative operating result l Low gross margin GSKs long-term debt increased by 115.5% in 2008, which may lead to problems such as heavy interest payment, risk of having too little working capital and even increasing possibilities of bankruptcy. l Too much long-term debt This may lead to problems such as heavy interest payment, risk of having too little working capital and even increasing possibilities of bankruptcy. Opportunities Threats l Expanding market in emerging market Ford has a plan to expand its sale in the emerging market which has great buying power in the future. l Eco-friendly engine Ford has high reputation in the eco-friendly engine such as hybrid engine which has very promising market. l Fuel efficiency Ford found another opportunity in the market for fuel-efficient in small and middle car. l High competition Due to new competitor, lower demand and excess capacity. l Economic crisis Economic crisis and regression in USA where is the main market of Ford caused severe effect to the Company. 3.2. Key Financial Analysis Source: ThomsonFinancial Scaling Factor : 1,000,000 USD Currency: USD 12/31/08 12/31/07 12/31/06 12/31/05 12/31/04 Net Sales or Revenues 146,277.00 172,455.00 160,123.00 177,089.00 171,652.00 Operating Income 3,518.00 8,031.00 -8,167.00 7,010.00 10,681.00 Earnings Before Interest And Taxes (EBIT) -4,885.00 6,792.00 -6,689.00 9,354.00 11,669.00 Interest Expense On Debt 9,682.00 10,927.00 8,783.00 7,643.00 7,071.00 Net Income Available to Common -14,681.00 -2,764.00 -12,615.00 2,441.00 3,634.00 Total Assets 215,773.00 276,459.00 275,337.00 264,891.00 294,447.00 ST Debt Current Portion of LT Debt 63,972.00 61,052.00 62,456.00 59,904.00 66,433.00 Long Term Debt 90,716.00 107,478.00 109,593.00 94,428.00 106,540.00 Total Liabilities 231,889.00 269,410.00 277,643.00 250,812.00 277,525.00 Common Equity -17,311.00 5,628.00 -3,465.00 12,957.00 16,045.00 Net sales decreased from 2007 about 15% as the economic crisis in the State which is the main market of Ford. The Company has had substantial losses from operation since 2006. Ford has high outstanding of long-term loan which may causes liquidity deficiency or bankruptcy if the Company still has continuously loss in the future. As a result of net losses from operation since 2006, Ford has had negative shareholders equity since then. 3.3. Multiples Analysis MONTHLY HISTORICAL MARKET PRICES Y2008 Y2007 Y2006 Y2005 Y2004 January 6.64 8.13 8.58 13.17 14.54 February 6.53 7.91 7.97 12.65 13.75 March 5.72 7.89 7.96 11.33 13.57 April 8.26 8.04 6.95 9.11 15.36 May 6.80 8.34 7.16 9.98 14.85 June 4.81 9.42 6.93 10.24 15.65 July 4.80 8.51 6.67 10.74 14.72 August 4.46 7.81 8.37 9.97 14.11 September 5.20 8.49 8.09 9.86 14.05 October 2.19 8.87 8.28 8.32 13.03 November 2.69 7.51 8.13 8.13 14.18 December 2.29 6.73 7.51 7.72 14.64 . 5 Year 5 Year VALUATION Y2008 Y2007 Y2006 Y2005 Y2004 Y2003 Growth Rate Average P/E Ratio (High) -1.36 -6.93 -1.41 12.94 9.63 34.66 -1.04 2.57 P/E Ratio (Low) -0.16 -4.75 -0.90 6.64 7.01 13.16 -1.01 P/E Ratio (Close) -0.35 -4.81 -1.12 6.77 8.13 32.00 -1.01 1.73 Price/Sales 0.04 0.08 0.09 0.09 0.18 0.18 -0.80 0.10 Price/Book Value -0.32 2.62 -4.14 1.14 1.74 2.62 -3.94 0.21 Price/Cash Flow 0.44 1.24 1.76 0.70 1.11 1.35 -0.67 1.05 Price/Working Capital 0.00 0.00 0.00 0.00 0.00 0.00 -0.16 7.78 TARenderChart.png * P/E ratio turned to be negative since net losses from operation since 2006 and also the market price has continuously decreased from 8.58 in the beginning of 2006 to 2.29 at the end of 2008. * P/B ratio had negative value in 2008 from the negative book value of Ford. 3.4. Companys performance Worldscope Currency: USD PROFITABILITY RATIOS 12/31/08 12/31/07 12/31/06 12/31/05 12/31/04 Return On Invested Capital 0.25 1.92 1.95 2.95 3.32 Operating Profit Margin 2.43 2.94 3.12 5.02 6.54 ASSETS UTILIZATION RATIOS Asset Turnover 0.63 0.60 0.59 0.59 0.58 Net Sales Pct Working Capital 10.62 6.21 5.68 11.06 41.64 LEVERAGE RATIOS EBITDA / Interest Expense -0.50 0.62 -0.76 1.22 1.65 LT Debt Pct Common Equity -76.88 233.49 316.38 1,268.12 1,229.66 LIQUIDITY RATIOS Quick Ratio 1.05 1.08 1.12 1.08 1.03 Current Ratio 1.21 1.25 1.30 1.25 1.19 Profitability ratios do not show the good performance as Ford has had net loss from operation since 2006. Leverage ratios also go in the same trends as a result of negative equity and high outstanding balance of long-term loan. Liquidity ratios present that Ford still can generate cash to supply its working capital but if consider to the long-term debts Ford may cannot provide enough cash to support its debt payment since these ratios are still in the low range compared with its debt outstanding amount. 3.5. Cash flow analysis Source: ThomsonFinancial Scaling Factor : 1,000,000 USD Currency: USD 12/31/08 12/31/07 12/31/06 12/31/05 12/31/04 Net Cash Flow From Operating Activities -179.00 17,074.00 9,609.00 21,674.00 22,591.00 Net Cash Flow From Investing Activities 3,143.00 6,457.00 24,862.00 -7,462.00 8,567.00 Long Term Borrowings 42,163.00 33,113.00 58,258.00 24,559.00 22,223.00 Inc(Dec) In ST Borrowings -5,120.00 919.00 -5,825.00 -8,591.00 4,937.00 Reduction In Long Term Debt 46,299.00 39,431.00 36,601.00 36,080.00 36,021.00 Net Cash Flow From Financing Activities -9,104.00 -5,242.00 15,273.00 -20,651.00 -14,226.00 The Company cannot generated sufficient cash from operation and had negative net cash flow from operation. Moreover the Company had to pay interest expenses for loans and had high net cash paid for financing activity. 3.6. Stock market performance Ford shares have been traded lower than SP500 since 2001 until 2010. Especially since 2006 that the operating results had continuous substantial losses. 4. Honda Motor Company Limited 4.1. Introduction Honda Motor is one of leading automobile manufacturers in the world. The company develops, manufactures and markets automobiles, motorcycles and power products. The company also provides financing services to the dealer and customer for the sale of products. Honda has global operations in areas including North, South and Central America, Asia, Middle East, and Europe with its headquarter at Tokyo in Japan. Strategy analysis Honda Motor has three strategies. They are Staying Close to Customers, glocalization and five region strategy. Staying close to customers mean the maintenance of the qualities of a small company, Provide value product with flexibility and efficiency as a small company does and maintain global reach and technology advantage as a large company does is the drive to the future growth of Honda. Glocalization means the effort to launch subsidiaries in regions that could best meet the demand of local customers and expand the subsidiaries as the local demand increases. Five region strategy requires the operations focus on five areas the world. They are North America, South America, Europe/Middle East/Africa, Asia/Oceania and Japan. The management decisions are served to suit the situation in different areas. The advanced RD capacity equips the Honda to provide flexible products to adjust the need of these regions. Business activities The company operates through four business segments: the automobile business, motorcycle business, financial services, and power products. The automobiles business division manufactures passenger cars, multi-wagons, minivans, port utility vehicle, sports coupe and mini vehicles. Hondas automobiles use gasoline engines of three, four or six-cylinder, diesel engines and gasoline-electric hybrid systems. Honda also offers alternative fuel-powered vehicles such as natural gas, ethanol, and fuel cell vehicles. In 2008, the company sold 3,925,000 units of automobiles. The motorcycle business produces a range of motorcycles, including scooters, electric-motor-assisted bicycles, sports bikes and large touring cycles. Hondas motorcycles use gasoline engines developed by Honda that are air or water cooled, two or four cycled, and single, two, four or six cylinder. In 2008, the company sold a total of 9,320,000 units of motorcycles. Honda offers a variety of financial services to its customers and dealers through its widespread finance subsidiaries. Hondas power products manufactures a variety of power products including power tillers, portable generators, general purpose engines, grass cutters, outboard engines, water pumps, snow throwers, power carriers, power sprayers, lawn mowers and lawn tractors (riding lawn mowers). Honda also manufactures the major components and parts used in its products, including engines, frames and transmissions. Peer Group The globalization of the Honda motor makes it face the global intense competition. The competitors include Ford Motor, Nissan Motor, Toyota Motor, Volkswagen etc.(in the automobile sector) and Yamaha Motor, Harley-Davidson etc.(in the motor vehicle industry). SWOT Analysis Strengths Weaknesses l Global diversification The company operates a total of 397 subsidiaries, and 104 affiliates all over the world. l Leading market position and good brand image Honda is one of the largest vehicle and motorcycle manufacturers over the world with strong brand strength. l Strong Research and Development capacity The large investment in RD could equip Honda the capability to differentiate itself in the intense competitive market. l Declining Market Share in Sector Evident of decline in unit sales and lost of market shares in the automobile industry. l Low employee productivity Honda has a weak proportion on the number of employees and the revenues. Opportunities Threats l Growing demand in Asian market Honda has taken measures to occupy the huge potential Asian market. l Growing demand in hybrid electric vehicles The companys emphasis on hybrid technology innovation will capture market trends as an opportunity to enhance its market share. l Global competition The competition would result in price pressure and thus reduce the profitability. l Tightening emission regulations The emission standards will cause Honda to occur more costs in product development, testing and manufacturing process design. 4.2. Key Financials Analysis Source: ThomsonFinancial Currency: JPY Scaling Factor : 1000000 JPY 31/3/2009 31/3/2008 31/3/2007 31/3/2006 31/3/2005 Sales 10,011,241.00 12,002,834.00 11,087,140.00 9,907,996.00 8,650,105.00 Operating Income 189,643.00 953,109.00 851,879.00 730,889.00 630,920.00 Net Income Available to Common 137,005.00 600,039.00 592,322.00 597,033.00 486,197.00 Total Assets 11,579,494.00 12,439,610.00 11,964,917.00 10,533,995.00 9,187,808.00 Total Liabilities 7,449,150.00 7,753,539.00 7,359,399.00 6,320,785.00 5,828,513.00 Common Equity 4,007,288.00 4,544,265.00 4,482,611.00 4,125,750.00 3,289,294.00 Net Cash Flow Operating Activities 383641 1126918 904525 576557 746624 l The operating income reduces dramatically, approximately 80% from the previous years result. This result is caused by the severe decline in the sales and the consequently increase in inventory cost. l Before 2009, all the s are in a healthy and steady upward trend. But in the fiscal year ended at 31st march 2009, the volumes all experienced a dramatic decline. They are caused by the sales plunge. l The declines trends are due to the economic recession caused by the financial crisis because the demand in Japan, US and Europe shrank. The automobile industry faces a severe challenge and most companies in the sector reported unsatisfactory results. 4.3. Multiple analysis 31/3/2009 31/3/2008 31/3/2007 31/3/2006 31/3/2005 Price To Earnings 30.7 8.6 10.3 Price To Book 1.0 1.1 1.6 1.5 Price To Cash Flow 4.6 4.2 6.8 Price To Sales 0.4 0.4 0.7 0.7 0.6 l Although the P/E ratio increases significantly, its not a good sign. The increase in P/E ratio is not due to the high expectation of the investors and the fundamentals such as growth opportunities. Instead, the soaring P/E is the result of the plummeting earnings to common shareholders. l The price to book ratio and price to sales declined in 2008 and 2009, indicating the declining expectation of the investors and the slowdown of the growth trend. 4.4 Companys performance 03/31/2009 JPY 03/31/2008 JPY 03/31/2007 JPY 03/31/2006 JPY 03/31/2005 JPY Operating Profit Margin 1.9 7.9 7.7 7.4 7.3 Return on Equity 3.20% 13.29% 13.76% 16.10% 15.78% Long Term Debt / Equity 48.2 40.4 42.5 45.5 47.4 EBIT/ Interest Expense 8.2 54.9 62.4 70.7 58.3 Quick Ratio 0.6 0.7 0.8 0.8 0.7 Current Ratio 1.1 1.1 1.2 1.3 1.1 EPS 75.50 330.54 324.62 324.33 260.34 Dividend Yield 2.72% 3.02% 1.63% 1.21% Total Asset Turnover 0.9 1.0 0.9 0.9 0.9 Net sales per working capital 21.62 21.53 26.57 -43.54 -54.62 l The companyHonda Motors ROE reached the lower point since 2000 due to the negative trend in its operations (net income). This trend is caused by the shrinking unit sales and market share. l The gearing maintained the previous level but due to plummeting revenues and net income the interest cover appeared to be a bad index. l The productivity of Hondas assets decreased year by year: the asset turnover suffered an overall downtrend because the demand in automobile sector in the Japan, Europe and US market decreased. l Price and book value have been on a parallel downward situation due to the dramatic decline in sales. P/E ratio suggests a more severe decline of earnings. Similarly, the dividend yield experienced the same trend. 4.5. Cash flow analysis. 31/3/2009 31/3/2008 31/3/2007 31/3/2006 31/3/2005 Net Cash Flow Operating Activities 383641 1126918 904525 576557 746624 Net Cash Flow Investing Activities 1133364 1686399 1130704 672701 807853 Net Cash Flow Financing Activities 530862 688001 423410 24006 97495 l The net cash flow from operating activities declined to a large extent. The accounting policies are consistent with previous practice and the result is mainly due to the plunge of the sales revenue. l The cash flow from investing activities increase as the result of the disposal of assets. On the other hand, Honda increased the capital expenditure, in which RD expenditure and subsidiary expansion as an important source. l The cash flow from financing activities maintained the previous level, indicating the Honda did not change the financing policy of the company. But Honda reduced the short-term borrowing and emphasise the long-term borrowing. Also, Honda reduced the short-term investment largely probably because of the volatile investing environment in 2009. 4.6. Stock performance 03/31/09 03/31/08 03/31/07 03/31/06 03/31/05 Price(close) 2315.00 2845.00 4110.00 1822.50 1342.50 Price Change (Yr/Yr) -530.00 -1265.00 2287.50 480.00 142.50 Dividends 63.00 86.00 67.00 25.00 16.25 Shares Outstanding 1814.61 1814.54 1821.99 1826.15 1849.74 The price for Honda experiences a steady growth before the boosting effect in 2006. The investors were confident about the companys prospect because of its leading position in the automobile sector and the booming of the automobile demand. In the year 2006 the Honda stock price illustrates a considerable increase (close price at JPY 4110.00 on March 31st 2007). After that, as the global finance crisis and the impact on automobile industry, the profitability of the company declined and investors are suspicious at the future performance. The price decreased in the following two years and reach the level lower than 2004 and 2005. but the dividend did not experience the same dramatic downward trend because the company want to maintain the investors confidence at the company. 5. Volkswagen AG 5.1. Company overview Volkswagen Group is a German automobile manufacturing group; and according to s published by automotive industry analysts Global Insight in November 2009, is the largest automobile maker in the world by vehicle production. The Groups principal activities are to design, manufacture and distribution of cars and other vehicles worldwide. The Groups activities are carried out through two divisions: Automobile and Financial services. The Automobile division comprises the development of vehicles and engines, as well as the production and sale of passenger cars, commercial vehicles, trucks and buses. The Financial Services includes dealer and customer financing and leasing, banking and insurance activities, vehicle rentals and the fleet management business. Group consists of 342 Group companies, which are involved in either vehicle production or other related automotive services. Volkswagen Groups core market is primarily Europe. Of its automobile brands, Volkswagen Passenger Cars is its mainstream marque, and the Groups major subsidiaries also include well-known car marques like SEAT, Skoda, and the prestige marques of Audi, Lamborghini, Bentley, and Bugatti. The Group also has operations in commercial vehicles, owning Volkswagen Commercial Vehicles, along with a controlling stake in Swedish truck and diesel engine maker Scania AB, and a 29.9% stake in MAN SE. Volkswagens second-largest market is China, where its subsidiary, Volkswagen Group China (VGC), is by far the largest joint venture automaker, selling more than one million vehicles in 2008. Strategy The Volkswagen Group focuses on becoming an economic and environmental leader in the global automotive industry. Innovative ideas and technologies are the basis for the Volkswagen Groups growth and business success. Driving ideas is the motto dominating the philosophy and actions of group. The focus is not just on whats technological possible -an innovation is only truly good if it generates real added value for the customer and can be implemented in harmony with environment. Today more than ever, global challenges such as climate change and scarce resources demand sustainable solutions from industry and society that go beyond the usual boundaries of sectors and segments. As a globally active Group, Volkswagen is addressing these challenges with a commitment to using them as an opportunity to develop convincing solutions and use the findings in its strategic positioning. For many years now the Volkswagen Group has been employing various methods to envisage the future and thereby enhance its competitive position. The Volkswagen Groups 18plus strategy The company is being equipped to face the future: attractive new models and vehicle segments, as well as innovative environmental technologies point the way forward for increasingly economical internal combustion engines and gearboxes, for hybrid and electric vehicles and for second generation biofuels. Commercial success must invariably go hand-in-hand with an intact environment and good corporate citizenship. The basic position remains that, Volkswagen Group acts responsibly towards our customers, our shareholders, our employees and towards society. The Volkswagen Groups strategy 2018 The Volkswagen Group is pursuing the long-term goal of firmly anchoring the Volkswagen Group among the most successful automakers in the world. This applies in terms of profitability, customer satisfaction and quality, of accessing new markets and increasing our production output, and of our attractiveness as an employer. We aim to be the most eco-friendly automaker in the world! Business activities (Recent acquisitions) 1.Wilhelm Karmann GmbH Volkswagen Group revealed on 24 October 2009 that it had made an offer to acquire long-time partner and German niche automotive manufacturer Wilhelm Karmann GmbH out of bankruptcy protection. In November 2009, the Supervisory Board of Volkswagen AG approved the acquisition of assets of Karmann, and plan to restart vehicle production at their Osnabrck plant in 2012. 2.Dr. Ing. h.c. F. Porsche AG In December 2009, Volkswagen AG bought a 49.9% stake in Dr. Ing. h.c. F. Porsche AG (more commonly known as Porsche AG) in a first step towards an integrated automotive group with Porsche. This was agreed between Volkswagen AG and Porsche SE during negotiations on the contracts of implementation relating to the merger of the two companies. The merger of Volkswagen AG and Porsche SE is scheduled to take place during the course of 2011. 3.Suzuki Motor Corporation Volkswagen AG completed the purchase 19.9% of Suzuki Motor Corporations issued shares on 15 January 2010. Suzuki intends to invest up to one half of the amount received from Volkswagen into shares of Volkswagen. SWOT analysis Strengths Weaknesses 1.VW has boosted quality more than any other competitors in the past five years, cutting defects by 60% 2.In the US, VW almost outperformed GM 3.VW managers attend test drives, and therefore know exactly their different products. 4. A non-stop innovation for the new projects. 5. Cost-control is the important strategy for the company which helps the company outperformed in the sector. 1.VW still trails Toyota, Mercedes, Nissan, and Honda in overall quality 2.VWs cost of capital is relatively higher. Opportunities Threats 1. Growth potential in the American market. 2. VW may expect to attract numerous new investors because of its very good results on the stock exchange, 3. Potential cost decrease with their production strategy. 1.Risk of self-cannibalization between VWs brands, like top of the line VWs models and bottom of the line Audis. 2. Risk of brand dilution, confusion between the VW Passat and the Audi A4. 5.2. Key financials analysis Key financials 12/31/2008 EUR 12/31/2007 EUR 12/31/2006 EUR 12/31/2005 EUR restated 12/31/2004 EUR restated Sales 113,808.0 108,897.0 104,875.0 93,996.0 88,963.0 Operating EBIT 3,627.0 4,623.0 2,061.0 620.0 255.0 Net income to shareholders 4,753.0 4,120.0 1,954.0 1,120.0 693.0 Total assets 164,575.0 142,248.0 133,565.0 130,209.0 124,916.0 Total liabilities 127,187.0 110,310.0 106,606.0 106,562.0 102,235.0 Common equity 35,011.0 31,875.0 26,904.0 23,600.0 22,634.0 Operating cash flows 10,799.0 15,662.0 14,470.0 l Stable increase in sales although most of the peer group witnessed a slight decrease. l Operating EBIT and cash flows declined in 2008 after there years increased. l General trend shows a steady increase during these five years which implies a stable market position and potentials of growth in the future. 5.3. Multiples analysis 12/31/2008 EUR 12/31/2007 EUR 12/31/2006 EUR 12/31/2005 EUR restated 12/31/2004 EUR restated Price To Earnings 20.9 15.0 17.1 18.5 Price To Book 2.9 1.9 1.3 0.7 0.6 Price To Cash Flow 6.9 3.8 2.5 Price To Sales 0.9 0.6 0.3 0.2 0.1 l Multiples follow companys general trend and especially, in 2008, P/E ratio and Price to cash flow ratio witnessed a obvious increase which indicated the good performance of the company and its strategy of focusing on the products. 5.4. Companys performance key ratio 12/31/2008 EUR 12/31/2007 EUR 12/31/2006 EUR 12/31/2005 EUR restated 12/31/2004 EUR restated Profitability Return on equity 14.21% 14.02% 10.89% 4.84% 2.80% Operating profit margin 3.19% 4.25% 1.97% 0.66% 0.29% Asset Utilization Total asset turnover 0.7 0.8 0.8 0.7 0.7 Sales to capital employed 10.02 8.75 13.54 21.00 13.23 Gearing EBIT/Interest expense 7.6 7.3 3.1 3.0 2.5 Long-term debt/common equity 95.0 92.0 106.8 131.4 143.0 Valuation Investment EPS 14.28% 107.33% 72.93% 61.38% (38.17%) Dividend yeild 0.77% 1.15% 1.45% Liquidity Quick ratio 0.8 0.9 0.9 0.8 0.9 Current ratio 1.2 1.2 1.1 1.1 1.1 The starting point for the systematic analysis of the firms performance is return on equity (ROE). As we can see from the table above, Volkswagens ROE ratio witnesses a slight increase from 14.02% in 2007 to 14.21% in 2008. Meanwhile, when we compare the ratio in 2005 with 2008, it increased more than 10% which is a big progress. It also implies that the strategy of the company which is in terms of profitability, customer satisfaction and quality, of accessing new markets and increasing our production output, and of our attractiveness as an employer. shows a positive impact. There are three drives that can be used as the interpretation of the changes of ROE. From 2007 to 2008, both operation profit margin and total asset turnover decreased slightly. While financial leverage ratio such as long-term debt/common equity increased obviously. Since it is a main force of the increasing ROE that might be the result of the groups expand their business around the world and the acquisition and merger performance. EPS and Dividend yield showed a big decrease in 2008. That might be the response to the decrease of the operating profit margin and total asset turnover. The global financial crisis influences the economic situation around the world and most of the industries which has a negative impact on VW also. The liquidity ratio such as quick ratio and current ratio which measure the firms ability to repay its current liabilities almost remain the same in these five years. It is a good indicator for the companys comfortable liquidity situation. 5.5. Cash flow analysis Cash flow 12/31/2008 EUR 12/31/2007 EUR 12/31/2006 EUR 12/31/2005 EUR restated 12/31/2004 EUR restated Net Cash Flow Operating Activities 10,799.0 15,662.0 14,470.0 10,810.0 11,494.0 Net Cash Flow Investing (19,280.0) (15,202.0) (12,893.0) (11,353.0) (14,796.0) Net Cash Flow Financing 8,123.0 178.0 (114.0) (1,794.0) 5,968.0 Net operating cash flow witnessed a decrease from 2007 to 2008, although the net income increased from 6543.0 to 6608.0. This might be the reason of the increase of the inventory cash flow. At the same time investing cash flow showed a huge increase in 2008 and the financing cash flow as well. This s consistent with the leverage ratio listed in the pervious discussion. 5.6. Stock Performance 12/31/08 12/31/07 12/31/06 12/31/05 12/31/04 Price/Cash Flow Ratio 6.93 3.80 2.53 1.45 1.20 Cash Flow per Share 50.19 60.12 44.82 36.39 37.64 Free Cash Flow pe Share 23.63 41.08 22.02 12.46 9.49 Price Close 250.1 156.4 86.0 44.7 33.4 % Change 59.88% 81.98% 92.35% 34.00% (24.80%) Total Return 61.11% 84.07% 95.14% 37.45% (22.44%) 6. Renault SA 6.1 Overview of the company A. Company profile Renault has a major position in the Europes automobile industry. It owns the Dacia and Samsung Motors brands and has contracted an alliance with Nissan Motor. Renault has become the owner of Dacia (Romania) and the Renault Samsung Motors of South Korea. The company operates in 118 countries including Europe, Americas, Asia and Africa and is headquartered in France. Business Segments * Automobile The company in engaged with the design and production of passenger cars and light vehicles. It also produces gasoline engines. * Sales Financing The company provides sales financing for Renault and Nissan brands. Renault is involved also with leasing, long-term rental as well as with the supplement of loans for the purchase of vehicles. Performance Renault reported revenues of $55,603.40 million in the FY2008 that account for a 7.1% decrease compared to the revenues of FY2007. Revenues by Division * Automobile: $52,610.70 million (FY08), 7.6% decrease compared to FY07 * Sales Financing: $2,992.7 million (FY08), 1.5% increase compared to FY07 B. Strategy Analysis Renault Groups strategy incorporates three main targets: High Quality. Be recognized by the clients as being one of the best three automobile companies. Leader in Key Technologies, RD, Development of Hybrid electric Vehicles. High Operating Profit Margin Steady Growth. C. Peer Group Top Competitors * AB Volvo * Suzuki Motor Corporation * Fiat S.p.A * Toyota Motor Corporation * Ford Motor Company * Volkswagen AG * Honda Motor Co., Ltd * Daimler AG * Mitsubishi Motors Corporation * Hyundai Motor Co. * PSA Peugeot Citroen S.A D. SWOT Analysis Strengths Weaknesses l Renault-Nissan Alliance leads to reduction of the cost of both companies and increase of competitiveness. l The Global Operations smoothen the effect of a failure in a single market. Cost reductions- economies of scale. l Concentration on RD enhances Innovation and the development of new products that will boost the Sales. l Environmentally friendly practices. NOxtrap model transforms nitrogen oxides into neutral gas. l Safety leads to good Reputation. New Megane model was awarded with 5 stars l Lower Operating Profits compared to the competitors. l Lower Credit Ratings that reflect higher borrowing costs and not easy access to capital markets. Opportunities Threats l Expansion in India and China is going to enhance the companys profitability and growth. l Plan for the launch of eight new models in FY2009 will boost the revenues. l Increasing Demand for Hybrid Electric Vehicles. Renault along with Nissan has been in the process of developing such environmentally friendly vehicles. l Recession of global automobile industry l Strict Emission Standards. The emission standards adopted across various countries can incur additional costs for the product development and manufacturing operations of Renault. l Intense Competition among Companies. 6.2. Key Financial Analysis (USD in millions/ Tomson OneBanker) 31/12/2008 31/12/2007 31/12/2006 31/12/2005 31/12/2004 Sales 52,532.84 59,476.93 54,760.06 48,761.43 55,339.55 Operating Income 492.09 2,204.69 1,401.70 1,560.58 3,256.63 Net Income 793.74 3,902.07 3,783.15 3,971.64 4,826.50 Total Assets 88,380.44 99,383.58 90,363.06 80,331.68 81,527.13 Total Liabilities 61,390.48 67,118.78 62,406.79 57,139.98 59,868.38 Operating Cash Flows -337.79 6,937.17 3,409.98 5,998.16 6,737.52 According to table above, 2007 was a prosperous year with the accelaration of sales and thus the increase in the operating cash flows. This optimistic image can be attributed to the growth of the sales in the international context and the significant reduction of the manafacturing and logistics costs. The companys declining operating income reflects mediocre cost management and bad decision making. The total assets increased gradually till 2007 in combination with a relevant increase in non-current assets and the inventories, according to the balance sheet. The total liabilities followed an increasing trend between 2005 and 2007 that is owing to the rise in current items, such as short term obligations. In 2007, the company devoted great amounts of money for restructuring reasons. The fall in volume and the reduction in production in order for the company to decrease the inventory, had a negative effect in the cash flow coming from operations. The negative impact of the strong yen an d the lessening consumer confidence contributed also to the bad financial results in 2008. 6.3. Multiples Analysis 31/12/2008 31/12/2007 31/12/2006 31/12/2005 31/12/2004 Price/Earnings 8.32 9.40 8.15 5.22 5.52 Price/Sales 0.14 0.66 0.63 0.46 0.42 Price/Cash Flow 1.44 5.29 6.34 3.93 3.11 Price/Book Value 0.27 1.25 1.23 0.99 1.09 The Price per Earnings Ratio declined till 2006 whereas in 2007 it rose to 9.40 and then fell to 8.32 in 2008. The low s of the 3 first years reflect the lower profits compared to next years. The highest of 2007 indicates that the market was willing to pay more for each dollar of annual earnings, compared to the other years. In 2007 the sales were boosted but then the economic crisis led to a lower PE ratio. The Price per Sales Ratio increased from 2004 to 2007 and then it fell sharply to 0.14. This trend means that till 2007 the investors were willing to pay more money for every dollar of the companys sales. The economic crisis in 2008 makes the investors more conservative. The Price to Cash Flow Ratio increased from 2004 to 2006, it then fell from 6.34 to 5.29 and then declined to a great extent reaching the level of 1.44 in 2008. This trend is mostly attributed to the relevant movement of operating cash flows (denominator in the ratio). In particular, cash flows from operations declined from $6,737.52 million to $3,409.98 million in 2006, then they almost doubled in 2007 and fell sharply in 2009. The low price cash flow ratio reflects the very low stock price (numerator) as reflected due to the economic crisis. The Price to Book Value decreased till 2005, then rose within the next two years and fell steeply to 0.27 in 2008. This ratio looks at the value the market places on the book value of the company. The greatest level of 1.25 in 2007 indicates that the market was willing to pay higher premium for the company. The least confidence is depicted in 2008. 6.4. Companys performance 12/31/08 12/31/07 12/31/06 12/31/05 12/31/04 Profitability Return on Equity-total 2.82 12.66 14.38 19.42 24.81 Operating Profit Margin 0.94 3.71 2.56 3.20 5.88 Liquidity Quick Ratio 0.48 0.55 0.58 0.58 0.81 Qurrent Ratio 0.63 0.72 0.72 0.73 1.03 Gearing Gearing Ratio 26.22 25.09 26.21 30.74 103.63 EBIT/ Interest Expense 3.04 8.97 10.65 16.26 24.09 Activity Total Assets Turnover 0.59 0.60 0.59 0.61 0.66 Sales to Working Capital -2.81 -3.73 -3.71 -3.73 51.02 Valuation-Investment Earnings per Share 3.09 14.87 14.54 15.43 18.15 Dividend Yield 0.00 0.04 0.03 l Profitability The Return on Equity has substantially diminished over the last few years from 24.81% to just 2.82%. This gradual decline from 2004 to 2007 can be attributed to the increase of the shareholders equity along with the simultaneous decrease of the after taxes profit throughout these years, except for a small rise from 2006 to 2007 in the latter . A major decrease of the profits from 2007 to 2008 led primarily to the 2.82 ratio-a decrease of about 77%. The Operating Profit Margin declined gradually from 5.88% (2004) to 2.56% (2006), due to a higher than expected increase in raw materials prices and a competitive European Market. In 2007 the ratio climbed to 3.71% because of further international sales growth and a better management of manufacturing and logistics costs. In 2008 the operating profit margin fell to 0.94. Such decline can be attributed to the fierce reduction in production, the rise in cost of raw materials and all the relevant consequences of the economic recession in that year. l Liquidity Both quick and current ratios are below one, throughout all the years from 2004 to 2008(except for the 1.03 of current ratio in 2004), indicating the increasing disability of Renault to convert assets into cash quickly. This trend underlies the risk of the company of not meeting its short-term obligations. In addition, the level of inventories rose substantially to $8672.56millions till 2007 and in 2008 fell to 7320.21 millions. l Gearing The Gearing Ratio follows a downward trend from 2004 to 2007, while it slightly increased in 2008, indicating that the first four years the company reduced the financial risk and depended on the financing from equity rather than outside factors. Although the debt increased from 2004 to 2007, the common equity increased too, financing the maturities. In 2008 the ratio rose to 26.22 partially because of the decline of common equity from 2007 to 2008. The so called Interest Coverage declined all over the years reaching 3.04 in 2008 because of the increasing interest expense that is attributed to significant debt issuances. The 2008 of 3.04 that is below 5 should bear concerns. l Activity The total Assets Turnover followed a downward route (2004-2008), except for a minor increase by 0.1% from 2006 to 2007. The declining route can be mostly attributed to increasing capital base from 2004 to 2007, indicating that the fixed assets of the company contributed to the revenue generation. The Sales to Working Capital was negative from 2005 to 2008 due to negative Working Capital that means that there was not enough liquid reserve for the company to meet its obligations. The liquidity problem indicated above reflects this problem. However, in 2008 the ratio increased slightly because of the decline in the companys liabilities. l Valuation-Investment The Earnings per Share ratio declines throughout the last 5 years (except from 2006 to 2007) and in 2008 reaches a very low level of 3.09. The downward trend could partially be owing to the low levels of Income after Tax. In 2008 the Net income available to Common was $793.74million in comparison with $3,902.07million in 2007. Concerning the Dividend Yield, regardless of two s omitted in 2004 and 2006, it seems that it increased from 2005 to 2007 to 4%, enhancing the opportunities for investors. In 2008 the ratio fell to 0% in 2008, showing that the income accrued from the company investments reduced to zero as an impact of the economic crisis. 6.5. Cash flow analysis 12/31/08 12/31/07 12/31/06 12/31/05 12/31/04 Net Cash Flow from Operating Activities -337.79 6,937.17 3,409.98 5,998.16 6,737.52 Net Cash flow from Investing Activities 5,335.16 4,308.50 4,013.91 3,425.50 4,223.01 Net Cash Flow from Financing Activities 2,076.79 -4,299.73 342.84 -1,956.92 -1,170.27 Exchange Rate Effect -105.65 -213.45 75.16 127.39 347.95 Net Increase/Decrease in Cash Cash Equivalents -3,701.81 -1,884.51 -185.93 743.13 1,692.20 l Throughout the years from 2004 to 2008, the highest amount of cash flows generated from operations was recorded in 2007 ($6,937.17 millions), indicating the good financial position of the company and the high sales attained via the business operations. However, in 2008 the economic cricis as well as the constant attempt to keep the volume of inventories in low levels, reduced the volume and production of the company, leading to negative cash flow from operations. The Board of Directors decided not to pay any dividends in 2008. l After 2005, the cash resulting from gains from investments in the financial markets and operating subsdiaries, increased. That means that the joint ventures, acquisitions, the expenses for Research and Development and other Investing activities, proved to be prosperous. The Dividend Yield, especially between 2005 and 2007 fluctuated within high levels. l The Cash Flow from Financing activities was negative in 2004, 2005 and 2007, while in 2006 was positive but low. The negative numbers indicate that the long-term debts of the company as well as the common equity increased that period. The positive in 2008 may reflect the fact that the company uses its own cash to pay its shareholders. In fact, despite the crisis, the RCI Banque (subsidiary of Renault group) managed to provide sales financing to the Renault Group. l The negative Foreign Exchange in 2007 and 2008 can be related to the impact of yen appreciation on the hedge against the Groups share in Nissan and the depreciation of sterling. After 2006 there is negative net cash flow that means that the company does not have enough cash to support its operations. In fact, Renault appears to have a liquidity problem. 6.6. Stock market performance (millions USD) 12/31/08 12/31/07 12/31/06 12/31/05 12/31/04 Price(Close) 25.79 141.83 120.00 81.27 83.66 Price Change (Yr/Yr) -116.04 21.83 38.72 -2.39 14.66 https://banker.thomsonib.com/ta/TARenderChart.aspx?DSN=DatastreamEntityKey=Q000004030Key=RNO-FRKeyType=1Width=500Height=315ColorTheme=0Period=Frequency=annualPriceStyle=PriceIUC1=IUC2=IUC3=OtherIUC=ILC2=ILC3=ILC1=VolumeIndexStat=WMCCompareSymbolValue=CompareIndex=RELINDXIUC1Value=N/AIUC2Value=N/ASPeriod=12/31/2004EPeriod=12/31/2008IUC3Value=N/AILC1Value=N/AILC2Value=N/AILC3Value=N/AOtherIUCValue=N/AIdx2Y=0CustCmp2Y=0SymCmp2Y=0Unadjust=0PadData=1Rebase=1Currency=USDProduct_Code=BankerChartType=Price As seen from the table above the price of the company reduced slightly from 2004 to 2005 and then it increased substantially in 2006 and reached the level of 141.83 in 2007. In 2006 and 2007 the investors were more confident concerning the performance of the company and they were willing to pay a higher price for the companys stock. This is also justified by the increased level of dividend yields these years (4% and 5%), compared to the past, indicating that the shares were about to offer high returns. The economic crisis in 2008, affected the prices of most stocks, so a decline of 80% in the share price reflects overly the market turbulence that period. 7. Peer Analysis 7.1. Profitability Analysis 2008 2007 2006 2005 2004 Return on Equity Toyota Motor Company -3.98 14.49 14.68 14 13.6 Ford Motor Company 0.25 1.92 1.95 2.95 3.32 Honda Motor Company 3.2 13.29 13.76 16.1 15.78 Volkswagen AG 14.21 14.02 10.89 4.84 2.8 Renault SA 2.82 12.66 14.38 19.42 24.81 Operating Profit Margin Toyota Motor Company -2.25 8.64 9.35 8.93 8.76 Ford Motor Company 2.43 2.94 3.12 5.02 6.54 Honda Motor Company 1.9 7.9 7.7 7.4 7.3 Volkswagen Group 3.19 4.25 1.97 0.66 0.29 Renault SA 0.94 3.71 2.56 3.2 5.88 When reading the profitability ratio of the whole sector, some trends and characteristics can be found among these five companies. Return on equity shows how well a company uses investment funds to generate earnings growth. During the year from 2004 to 2007, the ratio did not change too much for each individual company. While, from 2007 to 2008, ROE decreased in four of the five companies except Volkswagen AG. For Toyota Motor Company, the even went to negative which is due to the negative operating income and net income. Ford, Honda and Renault showed more than 50% decreases. Only Volkswagen witnessed a slightly increasing trend. One of the important reasons is the declined net profit during these years, partly because of the severe competition within the sector which leads to the price cut, partly because of the rise in cost of raw materials which has a heavy influence on the cost of the products. Operating profit margin has a similar trend with the ROE. The s of the five companies declined from 2007 to 2008. For Renault SA, it declined almost 75%, as well as for the Toyota company. It is an obvious signal that the whole sector is influenced by the economic recession because each sale can produce less profit than that in the previous years. This is mainly because the declined demand around the world as well as the cost of the raw materials. The economic situation of the whole world is recovering recently. However, it might take some time to return to the situation before the financial crisis. In the following years, the sales might begin to increase step by step for the whole sector. But when considering the individual one, it depends on the different strategies. 7.2. Asset Utilization Analysis FY08 FY07 FY06 FY05 FY04 Asset Turnover Toyota Motor Company 0.71 0.81 0.74 0.73 0.76 Ford Motor Company 0.63 0.60 0.59 0.59 0.58 Honda Motor Company 0.9 1.0 0.9 0.9 0.9 Volkswagen AG 0.7 0.8 0.8 0.7 0.7 Renault SA 0.59 0.60 0.59 0.61 0.66 Sales to Capital Employed Toyota Motor Company 28.93 180.70 1412.62 29.78 15.30 Ford Motor Company 10.62 6.21 5.68 11.06 41.64 Honda Motor Company 21.62 21.53 26.57 -43.54 -54.62 Volkswagen Group 10.02 8.75 13.54 21.00 13.23 Renault SA -2.81 -3.73 -3.71 -3.73 51.02 The Asset Turnover Ratio followed a declining route from the fY04 till the fy06 across all the companies. In fy07 the ratio reached its highest point except for Fords that continued its upward trend till 2008. Automobile industry appears to have relatively low asset turnover ratios compared to other sectors, indicating higher profit margins. The decreasing trend till 2006 can be explained by the increase in the capital base of the companies. In other words, the fixed assets contributed to the revenue generation at a greater extent across the years. The rise in 2007 does not necessarily mean lower utilization of assets, but can be explained by the acceleration of sales because that year was a prosperous one. The Sales to Capital Employed explains how effectively a company is using its working capital (current assets-current liabilities) to increase sales and finance its operations. For each company there is different trend across the years. The extremely high ratio for Toyota in FY06 may indicate either excessive sales volume in comparison with the investment in the business or that the company is based on the credit granted by other suppliers like banks in order to supplement the margin of operating funds. Renault had negative ratio from 2005 to 2008 due to negative Working Capital that means that there was not enough liquid reserve for the company to meet its obligations. Honda experienced the same situation the first two years but after 2006, followed a stable asset utilization policy. 7.3. Liquidity Analysis 2008 Toyota Ford Honda Volkswagen Renault SA Quick Ratio 0.81 1.05 0.6 0.8 0.48 Current Ratio 1.07 1.21 1.1 1.2 0.63 The liquidity ratios could measure a companys ability to repay the short liability and the risk of financial distress. In the five companies we choose, the Renault SA has a bad sign of liquidity ratios. The current ratio for Renault is below 1, indicating the higher possibility to fail the debt repayment. However, this does not necessary mean it will go bankrupt. But an unhealthy and risky financial position is illustrated. In addition, Honda and Volkswagen have big gaps between quick ratio and current ratio. This means the two companies may have relatively higher proportion inventory in the current assets. In fact, due to the recession and the shrinking of the automobile market demand, the inventory could not be easily be transferred to current assets and cover the due liabilities. Therefore, the two companies may have risk if the market would not recover because the inventory also incurred costs. Take the context into consideration, although the ford has the highest liquidity ratio s it is not in a favor position because it has a very large outstanding debt amount. 7.4. Gearing Analysis 2008 2007 2006 2005 2004 EBITDA / Interest Expense Toyota Motor Company 20.94 86.19 77.33 153.70 146.20 Ford Motor Company -0.50 0.62 -0.76 1.22 1.65 Honda Motor Company 8.2 54.9 62.4 70.7 58.3 Volkswagen AG 7.6 7.3 3.1 3.0 2.5 Renault SA 3.04 8.97 10.65 16.26 24.09 Long Term Debt % Common Equity Toyota Motor Company 62.63 50.40 52.92 53.41 55.44 Ford Motor Company -76.88 233.49 316.38 1,268.12 1,229.66 Honda Motor Company 48.2 40.4 42.5 45.5 47.4 Volkswagen Group 95.0 92.0 106.8 131.4 143.0 Renault SA 26.22 25.09 26.21 30.74 103.63 * From the interest coverage ratio, Toyota has the best in term of generating revenue to cover interest expense. Renault, Volkswagen and Honda show better ratios compared with Ford during the economic crisis and do not show any difficulty to meet the interest expenses. However, Ford seems to have the worst situation as the negative EBITDA and high interest expenses and may be not able to generate sufficient revenue to cover the interest expenses. * All companies show that they rely heavily on debt rather than equity which can lead to bankruptcy if these companies cannot generate enough revenue to cover interest expenses and loan repayment schedule. In addition, Ford shows the worst situation among its peer, with negative equity and substantial outstanding long-term loan. This may cause doubt about the continuing operation in the future. 7.5. Dividend Analysis 2008 2007 2006 2005 2004 Dividend Yield Toyota Motor Company 3.21 2.82 1.59 1.40 1.63 Ford Motor Company 0.00 0.00 0.00 Honda Motor Company 2.72 3.02 1.63 1.21 Volkswagen AG 0.77 1.15 1.45 Renault SA 0.00 3.92 3.48 * Companies dividends are fluctuating; as we can see the companies dividend policies are quite varying. * Toyota is following an investor friendly policy, distributing dividends every year, even in 2008, in the middle of a severe financial distress. We can say that Honda is following a similar policy, although the declined in 2008. Volkswagen has a relative low dividend yield and even thought its continuously upward trend in earnings, exhibited an even lower in 2008. * Renault, being struck as well by the adverse effects of the general economic crisis, chose not to distribute any dividends at all in 2008. Moreover, Ford didnt distribute any dividends during the last few years, choosing to reinvest its residual earnings in order to survive its financial difficulties. * In general Toyota and Honda seem to have a relative higher dividend yield than their competitors, and trying to keep shareholders satisfied they seem to exhibit better investment opportunities. 8. Reference Annual reports Ford Motor Company Annual Report 2009 Honda Motor Company Annual Report 2009 Renault SA Annual Report 2008 Toyota Motors Company Annual Reports 2009 and 2008 Volkswagen AG Annual Report 2008 Databases Datastream Datamonitor https://www.datamonitor.com/ Company Profiles for Ford Motor Company 2009 Honda Motor Company 2009 Renault SA 2009 Toyota Motors Company 2009 and 2008 Volkswagen 2008 Thomson one Banker https://banker.thomsonib.com/ Worldscope I/B/E/S Websites Toyota Motor Company https://www.toyota.co.jp/en/index.html Honda Motor Co https://www.world.honda.com/ Management Philosophy- Porters Five Forces Automobile Industry https://dianasunblog.blogspot.com/2008/03/porters-five-forces-automobile-industry.html Five Competitive Forces in Chinas Automobile Industry: Bus and Coach Sector, Kwan Yu Him Honda Motor Co., Ltd. Financial and Strategic Analysis Review, Global Market Direct Honda Strategy https://www.classicmotorstt.net/tradition_strategy.shtml Books Palepu, K.G., P.M. Healy V. L. Bernard and E. Peek, Business analysis valuation using financial statements, Thomson South-Western, 2007 Business analysis and valuation ( required text book) ch5

The Relationship Between Ethnicity And Risk Factor For...

Rachel Ahn Psych 38 Professor Krause Relationship between Ethnicity and Risk Factor for Eating Disorders The relationship between ethnicity and eating disorder risk factors is a complex issue. There are many other variables that affect these two ideas, such as socioeconomic status, level of educational attainment, and acculturation. Flaws in studies such as unrepresentative and insubstantial sample size, and participation bias still have yet to be corrected for in order to obtain a more accurate understanding of the role ethnicity and its factors plays in eating disorders. Previous studies have suggested that the difference in eating disorder symptoms across ethnicities were negligible; however, the risk factors, such as the†¦show more content†¦This survey measured the fear of fat and stress caused by weight and shape via recording binge eating. It also measured the pressure to be thin by family and friends across a 7 point scale system. It also recorded eating disturbances within family, peer, and the individual’s perception of media, preoccupation with weight, extreme weight control behaviors, binge eating, and thin ideal internalization. (Shaw Ramirez, 2004) The results show that there seem to be more similarities than differences in body image and eating disturbances across ethnic groups. Among the tests, only 1 out of the 14 tests showed any substantial sign of differences in the eating disorder symptoms across ethnicities. 49 tests disproved that ethnicity affected the relationship between risk factors and eating pathology. They also found that socioeconomic class drastically affected results; eating disorder symptoms heavily influenced by age and socioeconomic status. The researchers discovered also that the mean differences between ethnic groups was not significant between the two groups that was tested with questionnaires and the group tested with interviews. Eating disorder behaviors such as purging, dieting, fasting, using laxatives across ethnicities was negligible. However, the study did find that the difference in women with amenorrhea in terms of eating disorder symptoms are most significant. (Shaw