Compare the financial profitability ratios (Net Profit Margin, ROA, ROE) for Exxon Mobil with those of some other companies like, say, Wal-Mart, General Electric, Lockheed Martin, or Kraft Foods. (These are representative large companies in diverse industries not directly associated with big oil). If the results show Exxon Mobil’s ratios are significantly higher than the others we can join the crowd, carry signs in front of gas stations, and call for boycotts. If the results show that Exxon Mobil’s ratios are not out of line with the others, however, we might reluctantly have to agree that perhaps Exxon Mobil’s leaders are not villains after all and search for some other culprits.
1. Research the Internet (I like www.sec.gov, but you can use other sources if you prefer), find the 2011 financial statements for Exxon Mobil, and calculate the company’s Net Profit Margin, ROA, and ROE ratios for 2011.
2. Pick out three other companies of your choice (I listed some representative samples above, but you can pick any ones you like) and calculate their Net Profit Margin, ROA, and ROE ratios for 2011.