Analyzing Ratios & Financial Statements
Since 2010, the current assets on the balance sheet have decreased by 6.5%. Normally, this would not be good sign, but since liabilities has also decreased by about the same at 5.5%, and never go above the current assets, I'm not too concerned. Plant, property, and equipment increased by 4.5% sin 2011, but dropped off 2.9% in 2012. They had been buying companies like autonomy in 2012 which may have contributed to the increase if they had also bought and kept PPE associated with Autonomy. As part of the restructuring Meg Whitman is implementing, unnecessary costs are to be eliminated and assets sold off, which may have led to the slight drop in 2012. Goodwill and intangibles jumps up by a huge 19.7% in 2011 when they acquisitioned Vertica Systems, Hiflex, and Autonomy Corporation, but in 2012 drop well below the previous year, 42.9% to be exact. This occurred in large part to huge write-offs that HP did after paying way more than what the companies were worth. Leading the write-offs were and $8 billion write-off of EDS they acquired back in 2008. Other Assets stays fairly consistent after a 12% drop from 2010, but Total Assets drops off a significant 16.6 from 2011 to 2012, in large part to the write-offs. Current Liabilities only saw a slight 2.1% increase from 2010, then the 7.6% drop off I alluded to previously. Noncurrent liabilities increased after 2010, after HP purchased time deposits, money market funds, mutual funds, and other debt securities primarily consisting of
corporate and foreign government notes and bonds, and common stock and equivalents. HP also issued bonds to increase cash. Retained earnings in 2012 went down 34.2% since 2011, which is to be expected with a number of company purchases they had made. They still have plenty of money in retained earnings to pay out dividends, and as of the first quarter of 2013, their retained earnings is at $22.2 billion. Treasury...