Discuss the trends revealed in each ratio.  Please be sure to note your firm’s name in the title of your post and please do not duplicate firms.

Company X is a major aerospace engineering company. The ratios reveal several trends. Firstly, their current ratio has increased steadily over the past three years from 1.89 in 2012 to 2.92 in 2014—indicating that they have become more liquid and are better able to cover their short-term obligations. The increase could be attributed to an increased cash balance or the reduction in liabilities.

Their debt/equity ratio also decreased during this period from 1.76 to 0.91, suggesting that the company’s debt burden has been gradually decreasing as equity financing (e.g., retained earnings) becomes increasingly important for funding operations and capital expenditures.

Finally, their return on assets (ROA) has declined slightly from 8% in 2012 to 6% in 2014—a trend which may be attributed either to falling profitability or increasing asset base. In order to get a better understanding of why this is happening it would be helpful to compare these figures against industry benchmarks so that one can assess how Company X’s performance is stacking up relative to other players in the same field.

These trends indicate that Company X has improved its financial status, with increased liquidity and less reliance on borrowing. However, the recent drop in ROA is something to be closely monitored, as this could signal future issues with revenue generation, or with cost management, if it’s not dealt with quickly.