CANTEL MEDICAL
- Ratios from the most current and available 3 years
Ratios illustrate the capability of a given company to cater for its existing debts and accountabilities from its resources and sustainable revenue generation (Russ, 2010). CANTEL Medical has acquired positive financial ratios for the last three consecutive years contrary to the competitors. The market has changed thus requiring the corporation of all the players some pressures that most of its peers have not been able to meet. Despite the acquired revenue, CANTEL has remained rather committed based on its capability to make an additional investment into innovative products that have in turn grown its share. As at the end of 2017 the company has experienced a three consecutive year’s financial growth with an approximation of 16%. The market has compensated the company since it has acquired and steady growth and revenue sustainability.
Apart from the revenue aspect, the company’s stock price is essential in measuring the growth and stability of debts settlement. To begin with, Asset is a fundamental resource which is owned by the company and holds financial importance. CMD’s assets increased with close to 90 million dollars from 2016 up to 2017 (Traders, 2017). Liabilities are comprised the existing obligations such as short-run loans, suppliers payments and other pending payments taken to fund projects. The actual liability for CANTEL is 260.44 Million dollars. Shareholders equity is also a liability since it represents the debt owed to the shareholders of the company’s stock. During the three year period, the stock increased rather unexpectedly. Within the medical innovative industry, CANTEL is actually valued as it commands a market worth that is more than 4 times its actual tangible equity. However for the company’s Price to earnings (PE) ration on the stock as at the end of 2016 was 7.0 a state that is below the average earning in the industry. This, therefore, illustrates a wider opportunity for expansion (Traders, 2017). The constant revenue increase as the company seeks to strategically acquire is something that is admired by its investors.
- Alternative Strategies
There are some strategic alternatives that CANTEL can utilize to guard its sustainability and financial stability in the highly competitive market. This might include cost reduction, differentiation, business modification and diversification. Cost leadership is a niche approach that means that the company will be competing on the basis of cost (Russ, 2010). The company can lower its pricing to gain a large market share that does not equate with that of the competitor. Since the consumers in the market are different, this implies that low-cost approach will be effective in attracting new customers while retaining the existing ones. Differentiation is applicable in a competitive market. The company can add more innovative features to the existing products to create more value to the consumers. While diversification means to create newer products or expand to new markets. This approach is essential since CANTEL is innovative and it can no rely on differentiation to gain a competitive edge. This approach has assisted the company in exploring a wider market with new products thus making it hard for the rivals to match its strategies. On the other hand business adjacent is another strategic alternative. This involves getting into a market space where the business utilizes its comprehensive potential to generate adequate finances (Russ, 2010). The business is mainly focused on the existing market demands as its opportunities for expansion. A successful adjacent must consider the needs of the market while developing new products.
Figure 1: Cantel Medical Ratio Chart
ReferencesTop of FormBottom of Form
Russ, M. (2010). Knowledge management strategies for business development. Hershey, Pa: IGI Global.
Traders. (2017). CANTEL MEDICAL: Management's Discussion and Analysis of Financial Condition and Results of Operations. (form 10-K). Retrieved from http://www.4-traders.com/CANTEL-MEDICAL-CORP-12112/news/CANTEL-MEDICAL-Management-s-Discussion-and-Analysis-of-Financial-Condition-and-Results-of-Operatio-25195046/
