Describe and evaluate the financial environment at Genesis Energy by using ratio analysis of the company.

Genesis Energy’s newly established operations management team decided to seek outside assistance in developing a long-term operating plan that also addresses the financial issues identified. A major consideration for Genesis Energy is assessing those short-term and long-term economic factors, which will greatly enhance the company’s ability to successfully transition to a viable international business. Grasping and correctly prioritizing these economic factors, supply and demand, interest rates, inflation, unemployment, and exchange rates are pivotal, thereby requiring expert guidance. Therefore, their first major decision was to hire a respected strategy-consulting firm, Sensible Essentials.

After meeting with the client team, Sensible Essentials concluded that the operations management team would significantly benefit from a more in-depth understanding of the financial environment at Genesis Energy. This understanding needed to encompass not only sales, costs, and profitability forecast under the new strategic plan, but also the way expansion would highlight the need to manage working capital and cash flow in order to try to minimize the need for external financing.

As the lead consultant for Sensible Essentials, do the following:

• Describe and evaluate the financial environment at Genesis Energy by using ratio analysis of the company.
• Choose one ratio from each of the five categories listed in the table on page 103 of your textbook, Brigham and Ehrhardt, and do a 3-year ratio trend analysis (See attached Excel spreadsheet.  Only need to calculate the Market Value ratio). Compare these results to the industry averages. What do the results tell you?
• Name three specific options that are available to Genesis Energy for obtaining needed capital.
• Identify and explain two ways Genesis Energy can improve its strategy