David Jones Case
The task is to compare the shares of two companies, in this case David Jones Limited (DJS) and The Reject Shop Limited (TRS), by using financial ratios and other financial instruments to analyse and provide insight into which investment is fundamentally stronger and which holds more financial promise for the future. Firstly we will provide a brief overview of the companies and their current share price. Firstly David Jones Limited.
David Jones Limited [DJS] is traded on Australian Securities Exchange in Australia. It is located in Sydney, NSW and employs 19 people. The company currently falls under Mid-Cap category with current market capitalization of $1.38 Billion. David Jones Limited operates under Services sector and is part of Department Stores industry. David Jones Limited operates department stores primarily in Australia. Its stores primarily offer beauty and cosmetic products, women’s wear, women’s accessories and footwear, menswear and accessories, food products, toys, home products, and products for babies and children. DJS share price is currently $2.70 per share. David Jones Limited has a long and prestigious history in the Australian services sector and is one of the most recognisable and trusted brands in the country. From this long tradition the company has received a large market share and confidence from consumers. This long standing tradition is quite different to the other company in which we are comparing in The Reject Shop Limited as they are a predominately newer company that is on the rise.
The Reject Shop Limited [TRS] is traded on Australian Securities Exchange in Australia. It is located in Kensington, VIC and employs 3,912 people. The company currently falls under Small-Cap category with current market capitalization of $442.26 Million. The Reject Shop Limited operates under Services sector and is part of Discount, Variety Stores industry. The Reject Shop Limited retails discount variety merchandise in Australia. The company offers various general consumer merchandise, including toiletries, cosmetics, homewares, personal care products, hardware, basic furniture, household cleaning products, kitchenware, confectionery, and snack food; and lifestyle and seasonal merchandise, such as seasonal gifts, cards and wrapping, toys, leisure items, and home decorations. It operates approximately 276 stores. Its current share price stands at $17.28 per share.
Comparing the two.
In the task of comparing the two companies there are various financial tools and instruments in which makes comparison easy. The first of which is the use of financial ratios. These provide insight into the company’s financial position and can help provide a direct contrast between the two companies. The use of these will help in the determination of finding which investment is fundamentally stronger and holds more future financial promise. The first financial ratio that