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Course Project

Decent Essays

Oracle is one of the leading companies in the software and hardware industry. Oracle develops, manufactures and distributes various kinds of software and hardware systems worldwide. The company was founded in 1977 and is headquartered in Redwood City, California. Oracle currently has about 108,000 full-time employees worldwide. Microsoft Corporation develops, manufactures and distributes a range of software products and services for various computing devices worldwide. Microsoft also manufactures gaming systems such as Xbox 360 and related entertainments systems. Microsoft was founded in 1975 and is headquartered in Redmond, Washington. Microsoft currently employs about 90,000 full-time employees worldwide. Liquidity: Tootsie …show more content…

Microsoft’s Return of Assets Ratio of 21.2% is better than Oracle’s 13.4%. Finally, Microsoft’s Return on Common Stockholder’s Equity Ratio of 39.5% is better than Oracle’s 26.8%. However, Oracle does have a higher Price/Earnings Ratio of 23 vs. Microsoft’s 20 which means that the stock market is more optimistic about Oracle’s future prospects. However, the P/E Ratio of Oracle is not significantly higher than Microsoft so Microsoft still is a better company given all their Profitability ratios. Conclusion: Tootsie Roll is the safer investment when you examine the liquidity and solvency ratios; however, Hershey has the edge for two significant profitability ratios. These ratios are return on common stockholders' equity and the payout ratio. The stock market also is more optimistic about the future of Hersheys. That said, I would invest in Tootsie Roll because of their fiscal strength. Conclusion: Microsoft is the safer investment when you examine the liquidity and solvency ratios. Also, Microsoft has the clear advantage when you look at the profitability ratios of both companies. The stock market is more optimistic about the future of Oracle given the P/E ratio however Microsoft’s P/E ratio is not much lower than Oracle’s. Hence, I would certainly invest in Microsoft because of their fiscal

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