The ultimate stock analysis and valuation toolkit for intelligent investors

Company Balance Sheets Analyzer

Besides assets and liabilities information, the balance sheet can also tell you where the company’s funds come from and what they are spent on. This tool takes an X-ray picture of the balance sheet for each financial year and presents the data in a graphical form so you can easily spot trends and significant movement items in the balance sheets.

+Features

  • Balance sheets are constructed graphically for easy spotting of trends and significant movements.
  • Find out where the company’s funds come from.
  • Find out what management do with the company’s funds.
  • Investigates how the company grows – organically or via acquisitions.

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Balance Sheets Analysis for "WPP WPP PLC" from 2006 to 2016

Balance Sheets At-A-Glance


Balance Sheets Analysis
* ST - Short-term   LT - Long-term

Balance Sheets In Numbers

  2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016
Goodwill/Total assets 37% 35.2% 37.2% 38.9% 37.4% 38.2% 38% 37.9% 37.3% 37.1% 38.2%
Net fixed assets/Total assets 15.6% 15.2% 17.4% 18.2% 16.4% 16.1% 16.1% 15.1% 15.9% 16.4% 17.1%
Cash/Total assets 11.3% 11.8% 10.5% 7.5% 8.1% 7.9% 7.8% 8.9% 9.4% 8.3% 7%
Net current assets/Total assets 36.1% 37.8% 34.9% 35.5% 38.2% 37.8% 38.1% 38.1% 37.4% 38.2% 37.6%
Shareholders funds/Total funds 26% 23% 23.6% 26.4% 26.5% 27% 27.4% 30.3% 28% 26.6% 27%
LT debts/Total funds 8.3% 10.1% 16.3% 16% 14.8% 15.8% 14.8% 14.1% 15.5% 16.2% 16.1%
Net LT liabilities/Total funds 10.7% 9.5% 10.5% 10.3% 9.1% 9.5% 9.2% 8.5% 9.4% 7.8% 8.4%
ST debts/Total funds 4.8% 5.7% 5.1% 0% 0% 0% 0% 0% 1% 1.5% 1.5%
Net current liabilities/Total funds 50.2% 51.7% 44.5% 47.3% 49.6% 47.8% 48.6% 47.1% 46.1% 47.9% 47%
Interest-bearing debts/Total assets 13.1% 15.8% 21.5% 16% 14.8% 15.8% 14.8% 14.1% 16.4% 17.7% 17.6%

Use Of Funds For 2015 To 2016

  Source Use Conservative Funds Usage?
Long-Term £3,271m £3,751m Correct usage of funds indicator
Short-Term £2,549m £2,068m
Total £5,820m £5,819m

Summary

  • For 2015 to 2016 funds are not prudently allocated.
  • For 2016, 69.1% of long-term assets are goodwill.
  • From 2006 to 2016 shareholders wealth increased by 143.7%.

+Tips & Advice

  • Lookout for any major changes in the figures and be sure to find the reasons behind those changes. Sometimes you may uncover a potential investment opportunity or a nasty surprise.
  • Growing cash reserves often signal strong business performance. The business accumulates cash much quicker than management can find potential projects to invest. If management cannot find better use for the cash then management should return the cash to the shareholders through special dividends payment or share buyback.
  • Hard-to-measure intangible assets such patents, smart business processes and organic built brands are often not in the balance sheet.
  • Companies that are grown by acquisitions often shown increasing goodwill in the balance sheet. Over paid acquisitions can lead to future goodwill write-off that can depress earnings and share price.
  • Conservatively run business uses long-term funds to fund long-term assets.