Submit the first draft of Part 2 of your Project in a word document.
(MAXIMUM length: 1 page writing, 1-2 pages of charts/graphs) The goal of this part is to analyze the financial health of a public using financial ratio analysis. Choose any public company that trades on U.S. stock markets. Pretend that I am an uninformed investor who currently owns 10,000 shares of the company you choose. Prepare a report (for me as the investor) that includes a very brief overview of the companys business, its financial ratio analysis compared to two main competitors, and a recommendation based on your analysis about whether I should buy more shares of this company or sell my existing shares.
Tips: Your report should include the following three sections:
A very brief overview of what the firm does (in one or two sentences)
Financial ratio analysis of the firm compared to its competitors:
You need to fill out the following table and include in your report.
Ratios
Chosen Firm
Competitor 1
Competitor 2
Ratio 1
Ratio 2
Ratio 3
Ratio 4
The ratios come from Chapter 3. You need to pick 4 different ratios (such as current ratio, ROE, etc.), explain what each ratio indicates, and compare the ratios among your company and its two competitors.
To find the major competitors of the chosen company go to https://www.google.com/finance/ (Links to an external site.), search the ticker of the company, and you will see the list of companies under the tab Compare to.
To find Financial Statements for the chosen company and the competitors, go to https://finance.yahoo.com/ (Links to an external site.), search the ticker of the company, then go to Financials.
Recommendation based on financial ratio analysis on whether the investor that currently owns 10,000 shares of the company should hold, buy more, or sell the shares (in one or two sentences).
