QUESTION
WalMart (WMT)
WalMart (WMT) book value of equity was $48,655,000 for the
quarter ending October 3, 2015.
Market value of equity = the number of shares of stock
outstanding times the price per share
No. of shares = 2.9 billion
Market price per share = At the end of the quarter market price
per share was $64.98 (Yahoo finance)
Market value of equity = 2,900,000,000 * 64.98
=
$188,442,000,000
Which number is more relevant for shareholders?
Market value of equity is more important to shareholders than
book value since it determines the price one has to pay or receive to exchange
the shares of the company.
Reference
Yahoo Finance. (2015). WMT Historical Prices |
Wal-Mart Stores, Inc. Common St Stock – Yahoo! Finance. Retrieved from.yahoo.com/q/hp?s=WMT”>http://finance.yahoo.com/q/hp?s=WMT
Walt Disney, (November 5, 2015) Company reports: Fourth quarter
and full year earnings For Fiscal year 2015. Retrieved from.com/sites/default/files/reports/q4-fy15-earnings.pdf”>https://thewaltdisneycompany.com/sites/default/files/reports/q4-fy15-earnings.pdf
#2
You can find financial statements and annual reports directly on
the websites of listed/public companies. There are also several other online
resources for finding this information such as: sec.gov, edgars.com, finance.
Yahoo.com or any other reputable resource that you want to use. Continue with
the company that you analyzed in discussion question #1 (ex. Coke (KO) WalMart
(WMT), WaltDisney Company (DIS), Exxon (XOM), Goldman Sachs(GS)). For the three
most recent years, calculate the Du Pont identity for your chosen company. How
has ROE changed over this period? How have changes in each component of the Du
Pont identity affected ROE over this period?
ANSWER:
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