What is the sustainable growth rate

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Use the data below to solve for the sustainable growth rates for 2011 to 2015.

 

2011

2012

2013

2014

2015

Profit Margin

17

17

79.3

22.8

23.6

Retention Ratio

1

1

1

1

1

Asset Turnover

0.38

0.49

0.55

0.63

0.62

Financial Leverage

1.64

1.44

1.79

1.99

2

           

Sustainable Growth Rate

         

Actual Growth Rate

26.1

40.1

43.5

40

26.3

What is the sustainable growth rate for each year?  Based on your analysis of the sustainable growth rate between 2011 and 2015, what are your recommendations for the firm?

Reference no: EM131015820

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