Company Analysis Essay on Brown-Forman Corporation

2021-06-18
4 pages
909 words
University/College: 
Middlebury College
Type of paper: 
Essay
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Introduction

Brown-Forman is one of the corporations in the S&P 500 category. The corporation has close to 4,600 employees. It also has branches worldwide with most of them located in Louisville. The company is one of Americans largest spirits and wine companies. It has more than 25 brands of alcohol. Brown-Forman's ethics and integrity all settle on one issue, and the issue is integrity to customers. It believes that it cannot uphold its standards unless customers define themselves, the meaning of ethics. The company's code of ethics is only viable as long as the client's commitment is sustainable too. Brown-Forman requires a commitment in everybody. This includes individuals from each and every department, customers, and also the board of directors.

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The company also believes that its integrity and reputation and dealings all start with the clients. It is, therefore, important for the company that each and every individual lives by the firm's code. The company ensures that it teaches everyone to know and follow the Code. It believes that growth begins with asking questions and raising concerns about violations within the vicinity of the company. What the company believes in is to help and give guidance to the customers. Also, ethics are used as a corporation towards achieving the responsibility of everyone. The most treasured and original brand, the Old Forester Kentucky Straight Bourbon Whisky, is one of the first bottled bourbons in America. It also remains to be the companys most treasured and finest brand. The company can be traced back to the ancient descendants of the founder; Mr. Geo. Garvin Brown IV. The company is part of the generational family of the Browns. It is, therefore, a publicly traded and family-controlled kind of business.

Goals of the Company

The companys long and Short Term goals include:

To recognize the cost of diversity and accept personal responsibility.

To address the diversity of awareness

To have workforce diversity.

To create an environment in which all the workers can access development

To create a culture in which there is a mutual form of respect for everyone.

To ensure that the company is recognized as the best workplace for all the employees.

To continuously implement a global diversity curriculum that is web-based and mandatory for every employee.

To ensure that attraction and retention for employees is improved.

To improve the relevancy of the corporate brand of the corporation for the diverse consumer audience.

Managements View on Sustainability

At the end of 2015 when the annual report was produced, the companys GHG gas emissions were getting verified. The reports show that the corporation's direct emissions were on fuel use mobile uses. Other emissions include coal, gasoline, and natural gasses. The indirect emissions, on the contrary, included electricity use. There are also cases of optional emissions which are mainly due to business travels. The corporation through its facilities has continued to ensure that implementation of reduction projects of emissions has increased regardless of increased production. Even though there are increased total emissions, there has been an improvement in the manufacturing process through greater efficiency. The broilers of natural gas have also been improved through increased biomass boiler usage overall reducing emissions.

The energy that is used is determined through direct metering. However, the report has slightly different data compared to previous reports. This is because data management is also refined inventory verification is done. Even though the company's facilities have been implementing energy efficiency strategies and projects, and other improvement processes, it should be noted that an increase in production within the services has been due to increased use of energy.

DuPont Equation and Analysis

Benchmarks Ticker

Molson Coors Brewing Company TAP

Brown-Forman Corporation BF.A

Constellation Brands Inc STZ

Ambev ABEV

Return on Equity Benchmarks

Comparable Companies

Return on Equity

TAP

BF.A

STZ ABEV SAM
LTM 28% 168% 44% 23% 19%
FY-2 21% 62% 15% 27% 22%
FY-3 5% 35% 50% 29% 25%
Average 15% 75% 31% 35% 27%
Median 14% 79% 31% 28% 23%

The dividend stock growth has produced annual returns of 10.80% to all the shareholders of the company. The corporation has also managed to generate a 9.50% annual increase by the average for its EPS. The analysis shows that Brown-Forman company should be earning $3.10 per share and above as from 2010 and an increased amount of $3.30 per share should be registered in the coming years. More than half of Brown-Forman's sales come from global markets. Such markets are the driving forces of the corporation's growth in earnings. Most of the revenue is obtained from Jack Daniels Tennessee Line of Whiskey. However, such can be an issue in case the consumption of alcohol changes to wine or beer. Return on Equity, on the contrary, is stable after a rise over the past few decades. Regardless of focusing on values that are absolute, the focus should be on stabilizing return on equity as time elapses. The dividends annually recorded have soared by 9.80% by average which happens to be in line with EPS' growth.

Summary and Conclusion

The corporation has close to 4,600 employees. It also has branches worldwide with most of them located in Louisville. The company is one of Americans largest spirits and wine companies. It has more than 25 brands of alcohol. Brown-Forman's ethics and integrity all settle on one issue, and the issue is integrity to customers. It believes that it cannot uphold its standards unless customers define themselves, the meaning of ethics.

Works Cited

Investor, Dividend. "Brown-Forman Corporation: Dividend Stock Analysis." Seeking Alpha, 2010, https://seekingalpha.com/article/182751-brown-forman-corporation-dividend-stock-analysis.

Pont, Du. "Dupont ROE Analysis". Finbox.Io, 2017, https://finbox.io/SAM/models/dupont.

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