Starwood Hotels & Resorts Worldwide Inc. (HOT) and Marriott International Inc. (MAR) are two major owners and managers of lodging and resort properties in the United States. Financial data (in millions) for a recent year for the two companies are as follows:
Starwood Marriott
Income statement data:
Interest expense $ 111 $ 340
Income before income tax 669 2,345
Net income 489 1,907
Balance sheet data:
Total assets $8,268 $23,696
Total liabilities 6,969 21,471
Total stockholders’ equity 1,299 2,225
The average liabilities, stockholders’ equity, and total assets were as follows:
Starwood Marriott
Average total assets $8,464 $23,771
Average total liabilities 7,050 20,867
Average total stockholders’ equity 1,414 2,904
Determine the following ratios for both companies (round to one decimal place after the whole percent):
Return on total assets.
Return on stockholders’ equity.
Times interest earned.
Debt ratio for the most recent year.
Ratio of liabilities to stockholders’ equity for the most recent year.
Analyze and compare the two companies, using the information in (1).
