Financial Management Principles Essay Example | Topics and Well Written Essays - 500 words

Financial Management Principles - Essay ExampleAs an international player, the company is also very aggressive in pursuing strategies to find rapidly developing economies in Europe and Asia.As an investor, I believe that an investment in Dell will yield substantial profit. Its leadership dress in the global information technology (IT) industry makes it very attractive to investors. The unique and innovative business model of Dell which eliminates wastage and significantly increases production talent gives it strong brand equity. This good reputation significantly bids up the price of its stock. Dells efficiency contributes to profitability.Dells stock is a good investment as reflected on its unhomogeneous financial ratios. Table 1 shows the financial ratios of Dell which is divided in four groups-profitability, leverage, activity, and efficiency.Based on Table 1, Dell shows superior profitability. The companys return on equity is 86.5 % which reveals that every dollar invested in the firms stock will yields $.856 cents within a year. The company also generates a return on asset of 15.5% sequence gross margin accounts for 18.2% of the entire revenue. The companys profitability ratios reflect its efficient cost management.Dell is recognized as one of the most efficient companies in the IT industry.