You will pick a publicly traded company that is traded on the New York Stock Exchange (NYSE), NASDAQ, or the S&P 500. It is required that you pick a company that is on Fortune’s list of “Top 100 companies to work for”.
You will function as an investment advisory firm. Once you have selected your company and been approved, you will begin an in-depth analysis of the company. The analysis will be comprised of several elements, such as the company’s most recent financial statements, as well as learning all you can about the company in terms of products, success within its industry, and any current news that would be relevant to an investor. In your financial analysis, you should be looking at such things as revenue, net income, cash, etc. It should include ratio analysis on the financial statements. See Chapter 13 of your textbook for a list of ratios and be sure to include several of each category: Liquidity, Profitability, Solvency, and Market Prospects. Also remember that there is more in-depth coverage of many ratios in the chapters themselves. Use the Glossary to help you find where a particular ratio has been discussed in the text.
You will also take into account other factors that would influence your decision whether or not to recommend purchase of this stock. Some items in this category might include a new product or service, recent cost cutting moves, or consolidation or merger with another company. Finding this information will be part of your research for the project.
While conducting your research, you will be tracking the price movement of the stock as well as other relevant information about the company’s situation so as to better explain your positions in your final report.
You will be required to submit a final report written assessment of the company you chose must be a minimum of three pages, a maximum of five. All summaries and written assessments must be type-written using MS Word or comparable software, no more than double-spaced with margins of no more than one inch. In the final report assessment, you will support your reasons for either recommending or not recommending investing in this company by performing financial statement analysis, ratio analysis, and other contributing market factors as outlined above. The more detail and depth that you include in your analysis presents, the better. You must provide documentation of the company’s financial information, i.e. a copy of their most recent financials (Income Statement, Balance Sheet, and Statement of Cash Flows) available in their annual report or their 10K. To find the financial statements of your company, go to their website, click on Investor Relations (or some other similar link), and download the most recent Annual Report or 10K.
I expect you to do a good job of explaining your position. I will not tell you how to do the project as I want you to develop your own best methods. I will act as a resource and a sounding board for suggestions and ideas.
Your project will be graded on completeness, correctness, creativity, and the quality of presentation. I will be available to answer questions and provide some guidance, but the goal is for you to use your talents and imagination to figure out the best methods to accomplish the objectives of this project.
Your project should include, but is not limited to, the following:
- Recent financial statements (see above)
- Success in their industry
- Current news
- Ratio analysis (see Chapter 13)
- New products/service, cost cutting moves, consolidation or mergers?
- Tracking & analysis of stock price (I suggest using Excel)
- Professional appearance (cover sheet, no misspellings/grammatical errors)