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Dell and Apple will be compared based on operating profitability, asset utilization and risk management. Ten ratios comparing Dell and Apple during 2005 and 2006 will be defined, calculated and evaluated. Finally, an interpretation of these ratios as they are applied to Dell and Apple will be presented.
Operating Profitability
Operating profit is "a measure of a company's earning power from ongoing operations, equal to earnings before deduction of interest payments and income taxes, also called EBIT (earnings before interest and taxes) or operating income" (Inverstorwords.com, 2007). The formula for operating profit is: operating profit = operating revenue ? operating expenses...
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