Select a listed company, preferably from the London Stock Exchange. Assume that you are an analyst who works on behalf of existing investors.
Prepare an analysis report, where you will do the following:
Use the ratios covered in this unit, to evaluate the financial performance and health of the business in the following areas:
Profitability
Liquidity
Efficiency
Financial Gearing
Compare the financial performance and health of the business a competitor business.
In each area, make clear recommendations as to how the companys performance/health can be improved. If no improvement is needed, highlight what are the benefits to investors by the good performance of the business in each of the areas (a, 1-4)
Proposed structure of the report (the word count per section is indicative):
Title page
Executive summary (125 words max)
Introduction (100 words max)
Business and competitor brief profile (175 words)
Analysis (725 words)
-Profitability
-Liquidity
-Efficiency
-Financial Gearing
Conclusions (125 words)
Technical aspects
You need to perform time-series (at least 3 years; preferably 5 years) and comparative analysis (between your chosen company and its competitor)
For each area, produce and present the ratios for both businesses – your selected business and its competitor, in the same table/graph. You need to show your workings (e.g. formula and figures used).
