Review the Johnson & Johnson Annual Report and Procter & Gamble Annual Report 2012

Question 11

Review the Johnson & Johnson Annual Report and Procter & Gamble Annual Report 2012. Prepare a short essay comparing and contrasting the two companies. Use charts / graphics / analytics where appropriate. Limit to eight pages or less (including references). Bullet points recommended. Feel free to use Google to search other relevant materials.

https://www.jnj.com/sites/default/files/pdf/JNJ2012annualreport.pdf

http://annualreport.pg.com/annualreport2012/files/PG_2012_AnnualReport.pdf

• Business models and business segments
• Liquidity ratios
• Operating performance ratios
• Market performance ratios (e.g. P/E, PEG, Book value / market value, etc).
• Profitability ratios (ROA, ROE, gross profit margin, net profit margin)
• Common size financial statements: balance sheet, income statement, and cash flow
• Quality of earnings (financial reporting red flags)
• Financial leverage and capital structure
• Dividend policy, dividend payout, retained earning analysis
• Tax policy; nominal tax rate; effective tax rate.
• Financial risk management / risk hedging / risk reduction strategies
• Overall financial strengths and weaknesses

Question 12 Review the PDF file.Prepare a 2-3 page memo summarizing the major points of the article. 2). What lessons that you learned from reading the article?