Posted: April 4th, 2024

Identify two firms in the same industry and explain the reason for their perform, business and finance homework help

Question description

you have to choose two company in same industry and explain here an example for you to understand please i want a cited workNIKE & ADIDASCOLLAPSEComparison in this discussion question will be done by considering Nike and Adidas. These are firms that are very popular in the Apparel industry of the United States and the world in general. Performance of the both of the will be done by using the EPS and current ratio of both firms because this is a way to measure how well they are performing in the area of profitability that is important and available to each outstanding shareholder and how well the company can pay its immediate obligations looking at the available current assets it has. Both Nike and Adidas are basically affected by the same industry factors which influence their performance but they both have different performance outcomes and the reasons for the differences are discussed here.For Nike, based on Yahoo Finance information, the company’s EPS is 2.06 while for Adidas, it is 1.44. This is an issue that needs to be taken serious because both companies operate in the same industry and have close to the same size. A number of reasons have caused this difference. One is that based on what one footwear expert named Matt Powell said, Nike’s excellent performance and clear leadership in the apparel industry is that the company is known by the market and its loyal customers to sell high quality products and these are distributed with an effective distribution strategy and top class marketing strategies (Leach, 2015). This has helped Nike have a current market capitalization figure of $98.31 billion while Adidas has only $20.13 billion.In terms of brand recognition which is directly responsible for stimulating sales, Nike has been able to do this far better than Adidas because Nike provides a better Ecommerce experience than Adidas and other competitors. This can be described as a company strategy that Nike uses to a great effect in order to create great awareness for its new and quality products for consumers to buy (Ratcliff, 2014).Current ratio of Adidas is 1.49 and the one for Nike is 3.04. This shows a very huge difference and is also a measure of performance of the firms. With this, it means that Nike can very much settle its short term obligations better than Adidas and this kind of performance will be important for investors to use when deciding to invest because they will a stock that has great ability to pay off debt. The reason for this strength of better performance with current ratio Nike has over Adidas will be in the fact that Nike uses very effective marketing and sponsorship strategies to make the market very aware of its products and make people buy more of their products, thereby creating very good financial position for them.

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