In this case study, we have four companies across the top, starting with Coca-Cola. We want to calculate their profitability ratios and then compare them against each other. We'll do it for Coca-Cola and then copy and paste the formulas. So, for revenue growth, I press Equals, I go up to the top, and I take the year 20 figure divided by the year 19 figure, minus one. Oh dear. Coca-Cola down by 11.4%. Now, Coca-Cola's year 19, EBIT margin. I, again, go up to the top and I take their EBIT and I divide it by revenues, or sales. For EBITDA, similar again, up to the top, find their EBITDA number, divide it by the revenue sales, net margin, similar again, up to the top, find their reported net income, divide it by revenue.

Now, basic EPS, that was where you take their net income and then divided by the earnings per share and we've gotten that reported net income, and just a couple of lines underneath it, the number of basic shares is there, and lastly, for the diluted EPS, we do a very similar thing, reported net income divided by the number of diluted shares. So, let's compare just for Coca-Cola. I copy those numbers to the right and I can see Coca-Cola have had a disastrous year. Their revenue has gone down 11.4%. They had to shut a number of shops and a number of their sales venues were unable to sell their products, so a disastrous year for Coca-Cola there. However, for their EBIT and EBITDA margins, they improved, so they were good at controlling their costs even as their sales went down. Their net margin reduced ever so slightly. In line with that reduced revenue growth, their basic EPS declined and their diluted EPS declined. So, year 19 to 20, not a great period for Coca-Cola. I'm gonna copy those figures and I'm going to paste them into Keurig Dr. Pepper, National Beverage, and into our final one, Monster. Now, what we noticed about Monster, they had fantastic revenue growth in the same period that Coca-Cola had such decline. We can see their margins all improved and in line with that revenue growth, their EPS improved as well. Monster sells a branded product, a highly branded product that's, well, liked by the market, hence, they can charge premium prices. Those premium prices translates into high margins. Now, at the other end of the spectrum, National Beverage, not quite so well branded product, but they can't quite achieve that same premium pricing that Monster can, so lower margins, and unfortunately, those margins all declined over the last year and their revenue growth declined as well.

Keurig Dr. Pepper in the middle of the pack, they had reasonable growth. Their margins all improved during the year. You might notice, for most of the companies, that EPS follows the revenue growth. The one strange one, National Beverage, this happens to their EPS. They had very slight revenue decline, they had slight margin decline, and yet, their EPS is more than halved. Well, something interesting happened and we need to scroll up to find their number of shares outstanding in order to understand this. If we have a look at their number of basic shares outstanding, it went from 46.6 to 93 and this was because National Beverage had a stock split. So, if I really wanted to understand what's happened, I would have to change these numbers. So for instance, what I could do in the previous year is I could artificially multiply their number of shares by two 'cause that's what happens. Their number of shares doubled, and now, I can see that their basic EPS declined from 1.51 to 1.39. I do exactly the same thing for my diluted EPS. I multiply the number of shares by two and they're diluted. EPS declined as well.