Horizontal Analysis
Horizontal Analysis
Horizontal analysis is a procedure in fundamental analysis in which compares ratios or line items in a company's financial statements over a certain period of time. The horizontal analysis of Marriott International is shown below. | 2010 | 2009 | 2008 | Increase/(Decrease)Amount Percent | Revenue | $11,691 | $10,908 | $12,879 | $(1,188) | 9.2% | Expenses | $10,996 | $11,060 | $12,114 | $(1,118) | 9.2% | Operating income | $695 | $(152) | $765 | $(70) | 9.1% | Net income | $458 | $(346) | $362 | $96 | 27% | Earnings per share | 1.21 | (0.97) | 0.97 | 0.24 | 25% |
Table 1 ($ in millions), 2008 is the base year
In the year 2010, compare with the year 2008 there was a 9.2% improvement in expenses control. Therefore, there was a significant improvement (about 27%) in net income compare with the base year. Also, due to the better performance in net income therefore the earnings per share in 2010 was higher than 2008.
Compare the horizontal analysis with similar company (Hyatt Hotels Corporation) in the year 2010, the result were shown at below: Year | 2010 | 2009 | 2008 | Revenue | $3,527 | $3,330 | $3,835 | Expenses | $3,419 | $3,281 | $3,470 | Net income | $66 | $(43) | $168 | Earnings per share | 0.38 | (0.28) | 1.31 | 2008 is the base year |
Table 2 (Form Hyatt annual report)
| Marriott | Hyatt | Revenue | $11,691 | $3,527 | Expenses | $10,996 | $3,419 | Net income | $458 | $66 | Earnings per share | $1.21 | $0.38 |
Table 3 ($ in millions)
Compare with Hyatt Hotels Corporation, Marriott International had a better performance. This mainly because the company size of Marriott is bigger than Hyatt and therefore the amount of numbers were greater than Hyatt. Also, Hyatt had higher expenses (97% of its revenue). On the other hands, Marriott had better expenses control (94% of its
Horizontal analysis is a procedure in fundamental analysis in which compares ratios or line items in a company's financial statements over a certain period of time. The horizontal analysis of Marriott International is shown below. | 2010 | 2009 | 2008 | Increase/(Decrease)Amount Percent | Revenue | $11,691 | $10,908 | $12,879 | $(1,188) | 9.2% | Expenses | $10,996 | $11,060 | $12,114 | $(1,118) | 9.2% | Operating income | $695 | $(152) | $765 | $(70) | 9.1% | Net income | $458 | $(346) | $362 | $96 | 27% | Earnings per share | 1.21 | (0.97) | 0.97 | 0.24 | 25% |
Table 1 ($ in millions), 2008 is the base year
In the year 2010, compare with the year 2008 there was a 9.2% improvement in expenses control. Therefore, there was a significant improvement (about 27%) in net income compare with the base year. Also, due to the better performance in net income therefore the earnings per share in 2010 was higher than 2008.
Compare the horizontal analysis with similar company (Hyatt Hotels Corporation) in the year 2010, the result were shown at below: Year | 2010 | 2009 | 2008 | Revenue | $3,527 | $3,330 | $3,835 | Expenses | $3,419 | $3,281 | $3,470 | Net income | $66 | $(43) | $168 | Earnings per share | 0.38 | (0.28) | 1.31 | 2008 is the base year |
Table 2 (Form Hyatt annual report)
| Marriott | Hyatt | Revenue | $11,691 | $3,527 | Expenses | $10,996 | $3,419 | Net income | $458 | $66 | Earnings per share | $1.21 | $0.38 |
Table 3 ($ in millions)
Compare with Hyatt Hotels Corporation, Marriott International had a better performance. This mainly because the company size of Marriott is bigger than Hyatt and therefore the amount of numbers were greater than Hyatt. Also, Hyatt had higher expenses (97% of its revenue). On the other hands, Marriott had better expenses control (94% of its