o of 40%. This is separate from the credit operations debt ratio due to the different financial characteristics. The total debt ratio for 1999 is 49%. The price to cash flow ratio was 14.7 in 1999, and the price to revenue ratio was .89. The price to revenue ratio more than doubled since 1995 when it was only .23. Target Corporation has been very efficient, which reflects a return on equity of 20.2% in 1999 compared to 9.9% in 1996. Inventory turnover was relatively low at 6.3 in 1999. It is one of Target’s main areas of concentration. Profitability can be seen by comparing net profit after taxes to net sales resulting in a net profit margin of 3.5%. In 1999 Target Corporation also displayed a gross profit margin of 31.7%. The liquidity is displayed using the current ratio and the quick ratio. The current ratio of 1.1 has decreased since 1996 when it was more favorable at 1.4. The quick ratio also decreased by only one tenth of a point from .5 in 1996 to .4 in 1999. Additional ratios are presented in Appendix ACurrent Strategies Analysis Target Corporation’s operational strategy is to offer high-quality fashionable merchandise at affordable prices. It plans to achieve a future of strong growth in revenues and earnings by looking toward new store growth in Target, the primary segment. One of its functional strategies is to reinvest $2.5 to $3 billion in the business with a combination of capital investment and share repurchase. It plans to open 80 new stores and expand its reach to consumers by entering two new markets in West Virginia and Connecticut. Another strategy is to increase capital expenditures to continue remodeling programs for the existing divisions of Target Corporation. Suppliers are crucial part of the product distribution process. One strategy Target plans to continue using to promote good relations with suppliers is acknowledging excellent performance from vendors. Another strategy for Targe...
