ll. Canandaigua’s accounts receivable turnover is getting better, but is still higher by 6.42 days. The company’s days inventory is less than half of the industry standard, and almost three times less than the other two companies analyzed. Canandaigua could do a better job utilizing interest free financing. Its accounts days payable is much less than the industry standard. Cash conversion is much lower than others in the industry as well as the industry standard. This is probably due to the amount of beer that is sold, as opposed to wine which requires longer aging time.LONG-TERM LENDORSLong-term liquidity is good.Very few assets are required to service debt. Canandaigua’s debt to asset ratio is much lower(.33) than the industry standard(.63). This seems to be the case with the other two companies within this analysis. The company needs to continue to increase net income and reduce debt to improve its interest coverage ratio. Altman’s Z shows that there is a low probability of bankruptcy for Canandaigua.INVESTORS This stock is a buy.Canandaigua’s earnings per share is good in comparison to the other two companies in this analysis. EPS has improved from last year. The company has an adequate price to earnings ratio, but it is not as good as Beringer’s. BERINGER WINE ESTATES HOLDINGS, INC.DESCRIPTION OF BUSINESSBeringer Wine Estates Holdings, Inc. is a leading producer of California varietal table wines. The brand names include: Beringer, Meridian Vineyards, Chateau St. Jean, Napa Ridge, Chateau Souverain and Stags’ Leap. Beringer also imports wines from France, Italy, and Chile. Beringer was founded in 1876, and is the oldest continuously operating vineyard in Napa Valley.MANAGEMENT PERFORMANCEManagement performance is poor, but improving.Beringer’s return on assets is lower than the industry standard. Due to its higher inventory, ROA is less than it could be. Gross marg...
