Identify factors that effect the financial status of American Airlines - PDF document

Identify factors that effect the financial status of American Airlines
Identify factors that effect the financial status of American Airlines

Identify factors that effect the financial status of American Airlines - Description


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IntroductionThepurposeofthisresearchistoidentifyfactorsthateffectthefinancialstatusofAmericanAirlines(AAL)usedstockdatafromtheperiod20132017forAAL,SPY500and(WestTexasIntermediate)crudeoilpriceconductedcorrelationandmultiplelinearregressionanalysisovertheaforementionedperiodcalculatedthebetasCorrelationthestatisticalstrengthbetweentwoormorevariablestoshowhowrelatabletheyMultiplelinearregressionmodels/analyzestherelationshipbetweentwoormorevariablesBetaisthemeasureofmarketvolatilityLastly,gatheredthefinancialstatementsfromtolookatkeyfinancialchanges,balancesheetandincomestatementAmerican Airlines Inc.: A Financial OverviewResultsFromtheinformationgatheredforAAL,thereareseveraltrendsworthnoting Beta returnsveryvolatilewithrespecttothemarket(SPY),thepeakbeing94in2017ThebetaofWTInegative • Financial StatementsCashcashequivalents,andtotal • Ratios ThecurrentratioshowshassufficientliquiditytomeetitsshorttermdebtProfitmarginhasdecreased,hintingthattotalcostsincreasingfasterthantherevenues Table1: Elements of Balance Sheet of AAL. 2013 2017 Valentin KantchevAdvisor: Dr. JayendraGokhale Table 2: Elements of Income Statement of Apple Inc. 2013 2017 References : aacommergentonlinecominvestopediacomyahoocom/financeMethodcompleteresearch,performedthefollowingGatheredstockdatafromYahoofinanceWorkedwiththeclosingpricesofthethreeaforementionedstocks,andcomputedtheirreturnstoshowdependenceovertimeCorrelationandmultiplelinearregressionanalysisObtainedthefinancialstatementsofComputedthefinancialratios SPY Figure 1: of AAL 2013 2017 Liquidity Current Ratio1.4401.592 Quick ratio1.3511.473 Cash ratio0.1340.173 2014 DuPont 20162015 Profit Margin0.0670.186 Asset turnover0.7840.847 Financial Leverage13.5478.592 0.7071.350 Table 3: Liquidity Ratios Table 4: DuPont Ratios -0.06-0.04-0.02 Figure 2: of AAL 2013 2017 Abstract:ThegoalofresearchisprovidedetailedfinancialinformationonhowAmericanAirlineshasbeenperformingoverthepastfiveyearsThisincludesdetailedanalysisofthecompany'sfinancial,stock,andoperationalperformanceThishasbeenachievedthroughstatisticalmethods,interpretationofthefinancialstatements,andcalculationofthefinancialratiosBasedonthesemethodscanobservethatevenasthecompanyisgrowingitssales,itsoperationalmarginhasbeendecreasingsince Report DateCash & Cash Equivalents 295,000322,000390,000994,0001,140,000Total Current Assests9,146,00010,324,0009,985,00012,112,00014,323,000Total Assests51,396,00051,274,00048,415,00043,771,00042,278,000Total Current Liabilities14,964,00013,872,00013,605,00013,435,00013,806,000Long-Term Debt25,301,00024,573,00020,807,00017,963,00016,825,000Total Liabilities47,470,00047,489,00042,780,00041,750,00045,009,000Total Shareholder's Equity3,926,0003,785,0005,635,0002,021,000-2,731,000 Report DateNet Sales42,207,00040,180,00040,990,00042,650,00026,743,000Cost of Sales36,672,00033,573,00033,392,00036,857,00024,186,000Gross Margin5,535,0006,607,0007,598,0005,793,0002,557,000Selling & General Expense1,477,0001,323,0001,394,0001,544,0001,158,000Total Operating Expense38,149,00034,896,00034,786,00038,401,00025,344,000Operating Income (Loss)4,058,0005,284,0006,204,0004,249,0001,399,000 Table 5: Correlation of AAL with SPY YearCorrelation

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