Wine Industry Financial Analysis Essay -- GCSE Business Marketing Cour

Wine Industry Financial analysis DESCRIPTION OF BUSINESS Canandaigua Brands, Inc. (formerly Canandaigua Wine Company, Inc.) is a producer and supplier of wine-colored and an importer and producer of beer and distilled spirits in the United States. It maintains a portfolio of all over one hundred thirty national and regional brands of beverage alcohol which argon distributed by over 850 wholesalers throughout the United States and selected international markets. Its beverage alcohol brands are marketed in three general categories wine, beer and distilled spirits. Brands include Paul Masson, Manischewitz, Monte Alban, Almaden, Bartons cotton gin and Corona Beer.MANAGEMENT PERFORMANCEManagement performance is right.Canandaiguas go by on assets is better than the sedulousness standard for 1998, and just under the industry standard in 1997. The companys management has been able to cleanse the companys ROA by almost doubling net income from the foregoing year. Management has in the past done a sober task of utilizing its assets, and by the latest results is doing an even better job. Canandaiguas gross margin(25.62) is little than the industry standard(43.80%). It appears that the companys production costs are great than others in the industry. Profit margin(6.78%) is greater than the industry standard(6.64%) in 1998. Canandaigua is very good at controlling selling & general administrative expenses. Higher sales in 1998 resulted primarily from additional beer sales, largely Corona Beer sales, additional table wine sales and additional spirits sales. The company has increased its blow over on common stock certificateholders equity(12.84%), compared to the industry standard of 10.89%. Canandaigua does a fair job of controlling borrowing. Interest expense was reduced by ... ...ompanys operating cycle is very lengthy. Although, assuming most payables are due net 30, Mondavi appears to pay their bills on an average of 3.8 days early. semiperman ent LENDORSFrom a lendors perspective, Mondavi appears very strong in its ability to pay back long-term debt and interest despite having a debt to asset ratio 35% below the industry average. Mondavi has a very low probability of unsuccessful person with or without the market cap being considered. Accordingly, Mondavi would be a good candidate for a general line of credit from lendors.INVESTORS Mondavis stock appears to be over valued by approximately 100% compared to 1997 and 1998s per share market value. According to the EPS ratio, such over valuation appears to be consistent from 97 to 98, according to the EPS ratio. Therefore, it seems that investors would be hesitant to purchase Mondavis stock.