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Ahold versus Tesco–Analyzing Performance Case Solution & Answer

The case relates to the understanding and comparison of the performance of the two main companies, retail Ahold and Tesco. The case presents the tools and Dupont Dupont decomposition property. As measured by the return on capital performance was similar for the two companies, Ahold had much better performance of the stock market relative to Tesco. Ahold also has a significant amount of cash on their balance leads to low levels of net debt. The case, students must analyze the performance of using Dupont decomposition techniques modified to assess business performance is the result of the profitability of the operation or the financial leverage and propose strategies to improve performance. To perform the decomposition modified Dupont, students learn how to reformat and summarized balance and income statement separately to measure the profitability of operating and financing activities. Students also see how excess liquidity can weaken the profitability and the factors that should drive the appropriate level of leverage for a company.
by
Suraj Srinivasan,
Penelope Rossano
Source: Harvard Business School
11 pages.
Release: September 18, 2012. Prod #: 113040-PDF-ENG
Ahold against Tesco – Analysing the solution of the case of the performance

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