This report presents a financial analysis of the sportswear company Adidas by comparing different financial ratios over time and with its most identical competitors. It further reviews Adidas’s position in the financial markets and evaluates returns in relation to the level of risk associated from an investor perspective.
Following are the key findings:
– Despite stable sales Adidas’s financial performance declines considerable in 2014, leaving the company far behind its main rival Nike.
– A comparable high debt level exposes Adidas to increased financial risk.
– Adidas’s dividend yield is the highest in the industry.
– A sharp fall of the EPS in 2014 leads to a significant share price drop.
Inhaltsverzeichnis (Table of Contents)
- Executive Summary
- Adidas in Figures and Industry Overview
- Financial Ratio Analysis
- Profitability Ratios
- Efficiency Ratios
- Liquidity Ratios
- Financing Ratios
- Investment Ratios
- Review of Adidas's Position in the Financial Markets
- Conclusions and Recommendations
Zielsetzung und Themenschwerpunkte (Objectives and Key Themes)
This report aims to conduct a financial analysis of Adidas AG, comparing its financial ratios over time and against its main competitors. It also assesses Adidas's position within the financial markets and analyzes its returns relative to risk from an investor's perspective.
- Financial Performance Analysis of Adidas AG
- Comparative Analysis with Competitors (Nike and Puma)
- Assessment of Adidas's Profitability and Efficiency
- Evaluation of Adidas's Financial Risk
- Investor Perspective on Adidas's Performance
Zusammenfassung der Kapitel (Chapter Summaries)
Executive Summary: This section provides a concise overview of the report's findings, highlighting Adidas's declining financial performance in 2014 compared to its competitor Nike, its high debt level, high dividend yield, and the significant share price drop resulting from a sharp fall in earnings per share (EPS).
Adidas in Figures and Industry Overview: This chapter introduces Adidas AG, the second largest sportswear manufacturer globally, and establishes Nike and Puma as its primary competitors due to similar product lines and business models. It presents key figures for Adidas, including revenue, employee count, and market capitalization, and illustrates the comparative financial performance of Adidas, Nike, and Puma in 2014, revealing Adidas's underperformance.
Financial Ratio Analysis: This chapter delves into a detailed analysis of Adidas's financial ratios, categorized into profitability, efficiency, liquidity, financing, and investment ratios. The analysis reveals a favorable profitability trend until 2013, followed by a considerable decline in 2014 across all ratios. The report attributes this decline to lower EBIT, increased debt from Eurobond issuances, higher costs of sales and operating expenses (including increased marketing investments and rising production costs in China), and negative currency effects. A comparison with Nike highlights Adidas's significantly lower return on capital employed (ROCE) and return on total assets (ROTA), indicating potential management inefficiencies.
Schlüsselwörter (Keywords)
Adidas AG, financial ratio analysis, profitability, efficiency, liquidity, financing, investment, Nike, Puma, ROCE, ROTA, EBIT, EPS, financial risk, dividend yield, market capitalization, share price, cost of sales, operating expenses, production costs, competitive analysis.
Adidas AG Financial Analysis Report: Frequently Asked Questions
What is the purpose of this report?
This report provides a comprehensive financial analysis of Adidas AG, comparing its performance to competitors like Nike and Puma. It examines Adidas's financial ratios, profitability, efficiency, risk, and overall position in the financial markets from an investor's perspective.
What topics are covered in the report?
The report covers an executive summary, Adidas's financial overview and industry context, a detailed financial ratio analysis (including profitability, efficiency, liquidity, financing, and investment ratios), a review of Adidas's position in the financial markets, and concluding recommendations. It also compares Adidas's performance to its main competitors.
What key financial ratios are analyzed?
The report analyzes profitability ratios, efficiency ratios, liquidity ratios, financing ratios, and investment ratios for Adidas AG. Specific ratios mentioned include Return on Capital Employed (ROCE) and Return on Total Assets (ROTA).
How did Adidas perform in 2014 compared to its competitors?
The report indicates that Adidas underperformed compared to Nike in 2014. This underperformance is reflected in several key financial ratios, showing a decline in profitability and efficiency compared to the previous year and compared to Nike's performance.
What factors contributed to Adidas's financial performance in 2014?
The report attributes Adidas's decline in 2014 to several factors, including lower EBIT (Earnings Before Interest and Taxes), increased debt (from Eurobond issuances), higher costs of sales and operating expenses (due to increased marketing investments and rising production costs in China), and negative currency effects.
What are the key findings of the financial ratio analysis?
The financial ratio analysis reveals a favorable profitability trend for Adidas until 2013, followed by a significant decline in 2014 across all ratio categories. The analysis highlights Adidas's significantly lower ROCE and ROTA compared to Nike, suggesting potential management inefficiencies.
What is the investor perspective on Adidas's performance?
The report assesses Adidas's performance from an investor's perspective, considering factors such as return relative to risk, dividend yield, and share price fluctuations. The sharp fall in earnings per share (EPS) in 2014 resulted in a significant share price drop.
What are the key conclusions and recommendations of the report?
The report's conclusions and recommendations are detailed in the final section. While not explicitly stated in the provided summary, these likely address the identified weaknesses in Adidas's financial performance and suggest strategies for improvement.
What are the key words associated with this report?
Key words include: Adidas AG, financial ratio analysis, profitability, efficiency, liquidity, financing, investment, Nike, Puma, ROCE, ROTA, EBIT, EPS, financial risk, dividend yield, market capitalization, share price, cost of sales, operating expenses, production costs, and competitive analysis.
- Quote paper
- Miriam Rudolph (Author), 2016, A Financial Analysis of the Sportswear Company Adidas AG, Munich, GRIN Verlag, https://www.grin.com/document/317186
