Ameresco Inc.(AMRC) Research Paper Example | Topics and Well Written Essays - 500 words

Ameresco Inc.(AMRC) - Research Paper Example important to explain that current ratio under 1 indicates that a company does not have enough money which can be used in financing its daily operations or activities. A high current ratio is good for the organization. During the same period, the quick ratio of Ameresco was 0.98 (Ameresco Inc, 2015). This is a good indication, and it means that the company has enough liquidity, to meet its short term liabilities. On the other hand, the debt/equity ratio of the company is 0.37 (Ameresco Inc, 2015). This is a very low figure, which denotes that the company does not use debts for purposes of financing its operations. Based on this analysis, it is important to explain that the financial health of Ameresco as per the year 2012/2013 was very good. The major competitor of Ameresco is Johnson Controls. Johnson Controls is one of the Fortune 500 companies, and it has an employee base, of around 170,000 people. Due to its large size, it enjoys the benefits of economies of scale, in comparison to Ameresco. As of 2013, the current ratio of the company was 1.13 (Johnson Controls Inc, 2015). This is a lower figure compared to that of Ameresco, which stood at 1.90. This is an indication that Ameresco had a better capability of catering to its short term liabilities, when compared to Johnson Controls. In the same year, the quick ratio of the company was 0.68 (Johnson Controls Inc, 2015). This is a very low figure compared to Ameresco, and it is an indication that the company is struggling to pay off its bills. The debt to equity ratio of the company for the year 2013 was 0.37 (Johnson Controls Inc, 2015). This figure is the same, compared to that of Ameresco, and it is an indication that the company does not rely on debt to finance its operations. Based on this analysis, it is important t o explain that despite the large size of Johnson Controls, Ameresco has a better financial health. The uses of ratios, currency evaluations, capital budgeting and financial leverages are