Kmart Aquisition Essay

ACCT600 MAFM CAPSTONE

Winter you, 2012

Teacher Daniel Lagelier

Team M

Costco acquisition of Kmart via Sears Holdings Corp.

Adriana Guaderrama

Helen Hardy

Corie Hernandez

Owen Jennings

Wilner Luders

Mike Marzar

12/2/2012

Table of Contents

1Abstract1

2Current Budget - Costco1

2 . 1Results of Operations2

2 . 1 . 1Exhibit doze

2 . 1 ) 2Exhibit twenty-three

2 . 1 . 3Exhibit 34

2 . 1 . 4Financial Ratios4

3Performance Assess and Evaluation (Sears Holdings Corp)5

three or more. 1Asset Usage Measurement6

several. 2Breakeven Point6

3. 3Goodwill to Property Ratio7

a few. 4Interest Price to Debts Ratio7

3. 5Stockholder's Fairness & Purchase Turnover Ratio7

3. 6Profit Percentages8

three or more. 7Expense Insurance Days Ratio8

3. 8Profit per Person Ratio9

3. 9Current Ratios10

a few. 10Quick and Cash Ratios10

3. 11Inventory Ratio10

several. 12Debt to Equity Ratio11

3. 13Cash Flow Ratio11

3. 14Earning per Reveal, P/E and TIE Ratio12

4Valuation of Kmart12

5. 1Kmart's Inbuilt Value12

some. 2Kmart's market Value13

4. 3Kmart's Publication Value13

four. 4Key Figures – Pep boys Holdings Corporation14

5PERFORMANCE MEASUREMENTS15

5. 1Asset Utilization15

your five. 1 . 1Table 13 – Sales to Working Capital 2008 through 201015

5. 1 . 2Exhibit 715

5. 1 . 3Exhibit 815

5. 1 . 4Table 13 – Total Shareholder's Collateral 2008 through 201015

five. 1 . 5Exhibit 915

a few. 2Operating Performance15

5. 2 . 1Exhibit 1015

5. installment payments on your 2Exhibit 1115

5. 3Return on Collateral (ROE)15

5. 3. 1Exhibit 1215

a few. 4Earnings Every Share15

five. 4. 1Exhibit 1315

your five. 5Cash Flow15

5. your five. 1Exhibit 1415

5. a few. 2Exhibit 1515

5. 6Capital Structure and Solvency15

a few. 6. 1Exhibit 1615

five. 6. 2Exhibit 1715

your five. 6. 3Exhibit 1815

a few. 6. 4Exhibit 1915

a few. 7Net Earnings Margin15

five. 7. 1Exhibit 2015

5. 8Operating Revenue Margin15

your five. 8. 1Exhibit 2116

five. 8. 2Exhibit 2216

5. 9Market Performance16

5. on the lookout for. 1P/E Ratio16

5. being unfaithful. 2Exhibit 2316

5. 10Capitalization Rate16

a few. 10. 1Exhibit 2416

6FINANCIAL REPORT ANALYSIS16

6. 1Consolidated Financial Statements16

6. 2Auditing16

6. 3Analysis of Financials16

6. 3. 1Exhibit 2516

6. 4Sales16

6. 5Third-Quarter Results16

6th. 639-Week Period Results16

6th. 7Financial Update16

6. 8GUIDANCE16

7CONCLUSION AND RECOMMENDATION16

7. 1Similar Acquisitions16

7. 2Combined Value16

several. 3Anticipated Economical Performance16

8WORKS CITED16

Subjective

To prepare a summary of performance test and analysis of Sears Holdings Corporation pertaining to the acquisition of there supplementary Kmart. All of us will review the Current Financial position of Costco and assess the value of Kmart in preparation of creating a advice of offer to the Costco Board of Directors. *

Current Financial Position - Costco

Costco is the second largest dealer in the US and seventh most significant in the world thanks to their more than $90 billion dollars in gross annual sales. 1 They have 600 warehouses globally including 433 in the states. one particular While Costco has some businesses worldwide, they can be poised for further growth internationally especially in Asia. The current budget is extremely maximum. The $38 billion dollars market cover company provides about $5. 8 billion dollars dollars in cash and equivalents against $2. 3 billion of debt or nearly 10% net cash on the "balance sheet". 1 Their very own earnings are growing effectively and are expected to continue that trend with an estimated 16% growth news and 13% in 2013. 1 They pay a little but developing 1% dividend and have been shopping for back stocks at about a billion us dollars per year over the past half-decade. one particular They make around $2 billion in free earnings which gives these people a 20 or so times totally free cash flow multiple. 1 Coming from an detailed standpoint, Costco's operating model is generally similar across each of our U. S i9000., Canada, and also other international portions. They believe that the most important new driver of...

Offered: AccountingTools (2012). Breakeven Level. Retrieved coming from: http://www.accountingtools.com/breakeven-point

AccountingTools (2012). Revenue to Seed money Ratio. Recovered from: http://www.accountingtools.com/sales-to-working-capital-ratio

Herbst, Moira (2005). The Costco Concern: An Alternative to Wal-Martization? Retrieved from: http://www.d.umn.edu/~epeters5/Cst1201/Articles/The%20Costco%20Challenge.htm

Incorporation (2010). Selling. Retrieved from: http://www.inc.com/quarterly-financial-report/retail.html

Merritt, Cam (2012). Reasons for Decline in Stockholders Collateral. Retrieved coming from: http://www.ehow.com/info_10019281_reasons-decrease-stockholders-equity.html

http://phx.corporate-ir.net/phoenix.zhtml?c=83830&p=irol-reportsannual

http://phx.corporate-ir.net/phoenix.zhtml?c=83830&p=irol-sec http://www.sec.gov/Archives/edgar/data/909832/000119312511271844/d203874d10k.htm



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