M2 Assignment 2 Discussion

M2 Assignment 2 Discussion

Financial statements are often used to explain the financial position of a company. The four major financial statements are the balance sheet, the income statement, statement of cash flow and statement of retained earnings. The first selected public company in the United States is Tesla Company. Tesla Company began in 2003 and was inspired by a group of engineers who wanted to specialize in manufacturing electric cars. Since then, the company has been picking up well and growing very rapidly. As of December 31^st 2015, the consolidated balance sheet of Tesla Company showed that it had a prepaid expenses and other assets totaling to USD 2, 971, 568. Total assets for the company were USD 8, 092,460. Comparing with the figures of 2014, which the total assets were 5,830,667, shows how the company immensely grew within just one year. The statement for cash flows of the company shows that in the years of 2013, 2014 and 2015, the net cash provided by the financing activities was 635,422, 2,143’130, 1,523,523 respectively. The conclusion of the company based on its financial statistics is that the company is of medium level and has not stabilized in the market. Hence the returns per year can be fluctuating.

M2 Assignment 2 Discussion

The second company is Invesco and s an American independent investment management company. Looking into the income statement of the company, the years 2014, 2015, and 2016 had the operating income of USD 1,276.9 million, USD 1,358.4 million, and USD 1,176.4 million respectively. The total cash flows at the end of the respective years were USD792.4 million, USD775.6 million and USD812.9 million. At the end of the year 2016, the company recorded a decrease in AUM which was said to be as a result of changes in the foreign exchange. The gross revenue yield also decreased in the year of 2016. Judging the company from its financial abilities as presented by its four main financial documents, we can say that the company is well established in the market but is not in a position to grow fast. The company might be facing so many limiting factors such as huge competition which are likely to limit its growth opportunities. Hence the company has recorded decrease in the revenues based on the latest report. The company however has a strong financial positioning and so its market can be said to be strongly established as well.

The Third Company under review is the CMS Energy Corporation, which is a public company in the United States that has been operational since 1987 and currently operates in Michigan. It deals with gas, coal and nuclear as its main products. In the year 2017, gas sales generated the highest amount of income, contributing to 38% of all the company sales for the year. The annual comparisons of the total assets of the company in the years 2017, 2016 and 2015, were USD 23,050 million, USD 21,622 million and USD 20,299 million respectively. That implies that the company has consistently grown in assets for those three years. The Net Income available to Common Stockholders were $ 460, $ 551 and $ 523 in the years 2017, 2016 and 2015 respectively. The trend shows that the company has had its income declining, which expresses shortage in investment and market vulnerabilities. The company however proves to have financial strength to venture in more investment and has an opportunity of more growth.

M2 Assignment 2 Discussion

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