Fedex Analysis Essay Example | Topics and Well Written Essays - 1000 words

Fedex Analysis - Essay ExampleShargonholders expressed their dissatisfaction, in the latest sh areholders meeting, on effectiveness of management of the companys resources. The shareholders are justified in their notion because even though the company reported strong profitability ratios, its activity rations are very weak. Activity ratios such as days of sales receivables, days of sales in inventory, accounts receivables turnover, inventory turnover, and asset turnover ratio are too weak to warrant dissent opinion from shareholders. Ratios such as return on assets and profitability ratios are however high and should be appreciated. The companys management of its resources is worse than that of its main competitor, FedEex, because its ratios are worse than ratios that FedEx posted on activity. In days sales receivables, for example, UPS reported values higher 300 days in its considered periods while FedEex reported 43.31 days. In order to improve the companys situation, I can ensure implementation of effective marketing strategies for better turnover and introduce new policies for trust sales.As a loans officer for a commercial lender, I would approve the companys request for a loan. I would concur with the companys position that its stock is undervalued because of the unjustified shareholders opinion on the company, which may be shared by potentials investors to have adverse effects on the companys stock prices. In addition, the buyback may improve value of its stock. Taken as a short-term loan, it will reduce strength of the companys current ratio and quick ratio because of cast upd value of current liabilities when current assets remain constant. If taken as a long-term loan thence it will worsen the companys debt ratio that is already weak, below 1.0. Debt to equity ratio, which is already weak, will worsen because while the load will increase the