Conflict encountered by Manila Bulletin Publishing Corporation:

 The above-mentioned company fails to maximize profit by means of comparing

its financial performance for 2019 with the previous 5 consecutive years. It was
confirmed by the data gathered by the researchers by which the company was
only able to attain gross margin of 27.81% which is lower than the 5-year
average gross margin of 33.49%.

The researchers are able to point out probable reason behind this problem. They
have presumed that the company was not able to maximize the use of debt security
rather than issuance of equity shares to common stockholders. It was empirically
supported by the facts coming from their financial ratios. The debt ratio of the
company is only equal to 23.16% meaning, only 23.16% of the total asset was
financed by liability and the rest was financed by equity. With this situation, the
researchers assumed that the company fails to exhibit the advantages of financial
leverage. Consequently, it might deteriorate earning per share (EPS) ratio since the
company was heavily dependent on their own capital structures. It would be much
better if the company manages to fund some of their assets through debt security
so they can minimize the distribution of income among stockholders. Moreover, the
company’s current ratio is 2.28 which is also higher. It means that the company was
losing out opportunities to utilize their standing when it comes to liquidity which is a
manifestation of opportunity loss. The aforementioned ratio also implies that the
company is highly qualified to issue debt security since it indicates that they can
cover up currently-maturing obligations as they come due.

SWOT ANALYSIS:

 Strength
The company’s main strength was their less exposure to indebtedness. It will be
a nice impression for new investors to make investment to the company since
there will be assurance that they will be paid immediately in the form of
dividends.
  Weakness
Too high current ratio might be a weakness for the company. The inefficient use
of current asset might lead to such opportunity loss
 Opportunity
The advancement of technology is a big advantage for a media company. The
dissemination of daily news can now be convenient for the public through social
media platforms. News, nowadays, is being spread out over the cyber space that
is why current happenings in and outside the Philippines can be accessed by
netizens in just a snap.
 Threat
The advancement of technology brings a disadvantage for the company too.
People are now after with online news rather than waiting for the newspaper to
be published just like in a traditional way that people have grown up with before.

RECOMMENDATION:

 The company must be able to exhibit magnification of risk in a most efficient and
strategic manner. They must expose their entity into riskier option so they can
yield higher return. The use of borrowing to finance some improvements in the
equipments and machines used for production of newspaper shall be made in
order to maximize their good-standing current ratio.
 The company must be aware of opportunity cost because they might miss out
opportunity that will amplify their shareholder’s wealth if they continued to
disregard it.