Using the two stocks you selected from Homework #1, identify the Beta for each s

Question

Using the two stocks you selected from Homework #1, identify the Beta for each stock. In your own words, what conclusion can you draw from the stocks’ current and historical beta? If the stock market went up 10% today, what would be the impact on each of your stocks?

The two stock I chose were Google and Verizon Wireless.

Financial Ratios

Verizon

Liquidity ratio -

Current Ratio -

2013 – 70.99B / 27.05B = 2.62

2014 – 29.62B / 28.06B = 1.06

Quick Ratio -

2013 – (70.99B – 1.02B) / 27.05 = 2.58

2014 – (29.62B – 1.15B) / 28.06 = 1.01

Asset management ratio -

Asset Turnover Ratio -

2013 – 120.55B / 274.1B = .44

2014 – 127.08B / 232.71B = .55

Fixed Assets Turnover Ratio -

2013 – 120.55B / 88.96B = 1.36

2014 – 127.08B / 89.95B = 1.41

Days Sales Outstanding -

2013 – (120.55B / 365) / 12.44B = 37.7

2014 – (127.08B / 365) / 14B = 41.2

Profitability ratio -

Net Profit Margin -

2013 – 22.21B / 120.55B = .18

2014 – 13.44B / 127.08B = .11

Google

Liquidity ratio -

Current Ratio -

2013 – 72.89B / 15.91B = 4.58

2014 – 78.66B / 16.78B = 4.68

Quick Ratio -

2013 – (72.89B – 426M) / 15.91B = 4.55

2014 – No Inventory Reported

Asset management ratio -

Asset Turnover Ratio -

2013 – 59.73B / 110.92B = .54

2014 – 65.83B / 129.19B = .51

Fixed Assets Turnover Ratio -

2013 – 59.73B / 16.52B = 3.62

2014 – 65.83B / 23.88B = 2.76

Days Sales Outstanding -

2013 – (59.73B / 365) / 9.39B = 58.7

2014 – (65.83B / 365) / 10.85B = 66.28

Profitability ratio -

Net Profit Margin -

2013 – 11.3B / 59.73B = .19

2014 – 11.42B / 65.83B = .17

Explanation / Answer

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