BY: Brittany Rossi, Derek Choi, Jerome Balancio

Background information Hockey legend Tim Horton opened the first store in 1964 In 1967, Tim Horton and Ron Joyce (first franchisee) become partners In 2006, Tim Hortons becomes public for trading on the NYSE and the TSX Tim Hortons Background information

Shareholders In terms of shareholders, it would be not be wise to purchase more stocks or sell stocks at this time. Shareholders should hold onto them since at the moment, Tim Horton’s revenue is increasing by 7% from 2012-2013, while expenses are increasing by 10.9%, making the shares unable to accumulate more money at this time. Since Tim Hortons is prosperous in Canada, shareholders have protection that their investment is secure so they can hold onto their shares until a large return on their investment is gained. The profit margin is at 1.22, while the industry norm is 21%, showing that Tim Hortons still gains a large profit. Although Tim Hortons gains a lot of popularity, it is not at a high enough profit margin that shareholders should be selling stocks just yet.

Long Term Creditors Tim Hortons sales constantly rise, giving creditors security that their money will be received. The debt to equity ratio measures financial leverage of a company. Tim Hortons’ debt to equity ratio of 69% is normal since Tim Hortons dominates the Canadian market. Times interest earned measures a company’s abilities to honour its debt payments. Tim Hortons’ times interest earned of -8.75 is barely below the industry norm of 3.72 when you consider that the Canadian market where Tim Hortons thrives, is about 10% smaller than the American market, where Dunkin’ Donuts thrives. Therefore, the long-term creditors should be inclined and feel safe to make Tim Hortons a debtor.

Short Term Creditors Working Capital determines a company’s efficiency and if its stable financially calculated by a company's current assets minus its current liabilities current assets help pay of the company's debts or liabilities the company’s working capital is -10.5 million and the industry norm is -2 365 572, which means any short term liabilities and debts will not be easily paid off due to negatives amounts Short term creditors should not lend any funds to Tim Hortons as it is extremely risky

Accounts Receivable Turnover Current Ratio shows how effective a company is in extending credit as well as collecting debts and measures how efficiently businesses uses its assets Tim Hortons accounts receivable turnover is 3.01 and the industry norm is 1.17 Tim Hortons has a higher turnover than its industry norm, meaning that it is collecting its debts and extending its credit Current Ratio determines if a company can pay of their obligations both short-term and in long-term by knowing the company's liquidity Tim Hortons current ratio is 0.98, while industry norm is a 1.34 most likely to fail to pay any debts that occur, since their current ratio is at the zeros If one would lend funds, they need to take extreme precautions as it may lead to unsuccess

Acid Ratio has the ability to see if a company can use its cash or quick assets to rid of its current liabilities immediately. Tim Horton’s acid ratio is 9.42 while the industry norm is 1.34. This company would be able to meet its short-term obligations in period of time they have.

Should we invest in Tim Hortons? Although many of the included financial figures have increased for the better, operating expenses have also increased by 10.9%. The extraordinary gain has increased by 2.9%, showing that Tim Horton’s is extremely likely to not have their market crash any time soon if the investment did not accumulate more money. Despite this, it would most likely be a very small return on the investment to gain from investing in Tim Hortons. This means that, the investor would be wasting more effort to try making money than actually accumulating much. Therefore, investing in Tim Horton’s at this time is not a good idea.

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