Dan,
While you want to take a look at financials, let's compare the Quick ratio of both companies, i.e. (Current Assets - Inventories)/Current Liablities
Intel:
Current Assets: 18,739
Inventories: 2,652
Current Liablities: 7,387
Quick Ratio: 2.1777
Debt to Assets: 9331/46,249 = 0.2018
Times Interest Earned = EBIT/Interest Exp = 906/12 = 75.5
AMD:
Current Assets: 2,881.1
Inventories: 354.6
Current Liablities: 1,161.7
Quick Ratio: 2.1748
Debt to Assets: 6,029,405 /2752769 = 2.1903
TIE ratio = EBIT/Interest Exp. = 167,019/21,645 = 7.7163
As you can see from the numbers, while Intel and AMD have comparable Quick Ratios, AMD is highly leverage compared to Intel. Their D/A ratio is substantially higher to Intels. Additionally, AMD's TIE ratio is substantially lower. Therefore, any downturn or price war will affect AMD greater than Intel. These are basically Liquidity ratios, Dan. For kicks, let's compare CASH to DEBT.
Intel:
Cash: 2,861
Short term Investments: 7,197
Debt: 9331.0
Cash to Debt: 1.0779
AMD:
Cash to Debt:
Cash, cash equivalents, and short-term investments: 1.6
Debt: 2.752
Cash to debt: .5814
Look at these numbers Dan, Intel has more than enough money to pay All their debts, both current and longterm. On the other hand, AMD comes up short.
What are you going to argue now? |
