Comprehensive Project

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Overview

• Correct Formatting (10 points)
• Report analysis content should be a typed one (1) to two (2) pages
• Report margins are one inch all around the page
• Report should be prepared using “Times New Roman” font at size 12 point
• Report body line spacing may be single or double spaced
• Ratio calculations may be typed or NEATLY written by hand
• Ratio calculations may be typed into a spreadsheet program such as MS Excel
• A copy of each company’s Income Statement and Balance Sheet must be included
• Analysis
• Research Resource
• Analysis Suggestions
• Submitted Materials: Remember, this is a “PROJECT” and it counts as 12% of your total grade.

Prepare an analysis report on companies in a selected industry using data obtained from financial ratios.

The analysis report format should meet the following requirements:

• Prepare an analysis report on three (3) companies, in the same industry.Compare their performance using data obtained from financial ratios you will calculate using public financial data.
• The analysis will be conducted on 3 publicly traded companies chosen by each student.Use ten (10) financial ratios from “Exhibit 10 Summary of Analytical Measures” in your textbook to perform analysis on your (competitors) companies as follows:
• Your report analysis should contain the following elements:
• In these professional financial statements, you will encounter account names that may be unfamiliar to you. For example: Sales is usually called Total Revenue, Cost of Goods Sold will likely be called Cost of Revenues. Remember the order of accounts on a Multiple Step Income Statement or a Classified Balance Sheet will help you to identify these unfamiliar account names.
• Note that amounts on the financial statements are usually shown, in thousands.If you use the Working Capital ratio, in your project, either adjust your amounts, or note that your number is shown in thousands.
• Ten (10) ratios for each company which will create 30 total ratios.
• Calculate each ratio and show the equation and your calculations for that ratio (30 x 1 = 30 pts)
• Calculate each ratio using public data for each company that you obtain from the company’s Income Statement and Balance sheet.
• Present the thirty ratios (10 for 3 companies) in a chart for easy comparison
• A brief history in your introduction paragraph on your chosen industry (5 points)
• A comparison of the three (3) companies and their performance for each financial ratio
• Explain what each ratio calculation shows for each company’s performance and how the performance rated (slightly better, significantly better) relative to the other companies (10 ratios x 5 pts = 50 pts)
• Give a reasonable explanation of your company’s ratings and NOT just the numeric calculation (10 pts)
• Summary paragraph stating your opinion of each of the three companies and their overall ratios performance. Report a comparison of the ratios to industry averages (10 pts)
• Going beyond basic requirements (inclusion of nice cover sheet, logos, etc) – (5 pts)
• Note: It is highly unlikely that a single company will perform best on all ten (10) ratios.

Each student will:

Select 3 publicly traded companies that perform similar types of business activities.

Google Search is also a great tool, for identifying publicly traded companies within the same business. For example, a Google Search for “publicly traded farm equipment companies” yielded multiple sites that identified top companies in the farm equipment business. After selecting 3 companies, from the results of the Google Search, use Yahoo Finance, to gather the Stock information, Income Statement, and Balance Sheet, for each company.

Once you know the stock symbol for the companies you have selected, type each symbol into the “Quote Lookup” box, on the right side/mid-screen, at Yahoo Finance. If you know the company name, but not the stock symbol, use the “Search for news, symbols, or companies” search tool, at the top of the screen. To use this search tool, begin to type in the company name (spelling must be accurate), as you type the company name, it will show up in a drop-down list, for selection. If it does not appear in the selection options list, you either misspelled the name, it isn’t a publicly traded company, or it goes by a different name. Often companies are part of a larger corporate group, i.e., Olive Garden is part of Darden Restaurants, the parent corporation.

The report may be submitted electronically in Blackboard OR a printed version given to me in class.

• Submit ratio calculations using either Excel, Word or hand-written document.
• Submit a well-written report
• Submit the income statement and balance sheet for each of the three companies you selected to analyze.

SIDE NOTE – Recommendation by a former student:

To get a good print copy from the financial sites, go to Printfriendly.com, paste the url of the report/site you wish to print from.A cleaner version of the report will appear for printing in most cases.

POINTS RECAP:

Correct Formatting 10 points

10 ratios x 3 companies (30 total ratios)30 points

Discussion of the 10 ratios (5 pts each)50 points

Reasonable explanation of your company’s ratings (not just restating the numbers)10 points

Summary paragraph – discuss all three companies and industry averages10 points

History of industry in introduction5 points

Going beyond (inclusion of nice cover sheet, logos, etc) 5 points

Total 120 points
Industries Organized by Sector

 1. Basic Materials Agricultural Chemicals Aluminum Chemicals – Major Diversified Gold Independent Oil & Gas Industrial Metals & Minerals Major Integrated Oil & Gas Nonmetallic Mineral Mining Oil & Gas Drilling & Exploration Oil & Gas Equipment & Services Oil & Gas Pipelines Oil & Gas Refining & Marketing Silver Specialty Chemicals Steel & Iron Synthetics 2, Conglomerates Conglomerates 3. Consumer Goods Auto Manufacturers – Major Auto Parts Beverages – Brewers Beverages – Soft Drinks Beverages – Wineries & Distillers Business Equipment Cigarettes Cleaning Products Confectioners Dairy Products Electronic Equipment Farm Products Food – Major Diversified Home Furnishings & Fixtures Housewares & Accessories Meat Products Packaging & Containers Paper & Paper Products Personal Products Processed & Packaged Goods Recreational Goods, Other 3. Consumer Goods (continued) Recreational Vehicles Rubber & Plastics Sporting Goods Textile – Apparel Clothing Textile – Apparel Footwear & Accessories Toys & Games Trucks & Other Vehicles 4. Financial Accident & Health Insurance Asset Management Closed-End Fund – Debt Closed-End Fund – Equity Closed-End Fund – Foreign Credit Services Diversified Investments Foreign Money Center Banks Foreign Regional Banks Insurance Brokers Investment Brokerage – National Investment Brokerage – Regional Life Insurance Money Center Banks Mortgage Investment Property & Casualty Insurance Property Management REIT – Diversified REIT – Healthcare Facilities REIT – Hotel/Motel REIT – Industrial 4. Financial (continued) REIT – Office REIT – Residential REIT – Retail Real Estate Development Regional – Mid-Atlantic Banks Regional – Midwest Banks Regional – Northeast Banks Regional – Pacific Banks Regional – Southeast Banks Regional – Southwest Banks Savings & Loans Surety & Title Insurance 5, Healthcare Biotechnology Diagnostic Substances Drug Delivery Drug Manufacturers – Major Drug Manufacturers – Other Drugs – Generic Health Care Plans Home Health Care Hospitals Long-Term Care Facilities Medical Appliances & Equipment Medical Instruments & Supplies Medical Laboratories & Research Specialized Health Services 6. Industrial Goods Aerospace/Defense – Major Diversified Aerospace/Defense Products & Services Cement Diversified Machinery Farm & Construction Machinery General Building Materials General Contractors Heavy Construction Industrial Electrical Equipment Industrial Equipment & Components Lumber, Wood Production Machine Tools & Accessories Specialized Health Services 7. Services Advertising Agencies Air Delivery & Freight Services Air Services, Other Apparel Stores Auto Dealerships Auto Parts Stores Broadcasting – Radio Broadcasting – TV Business Services CATV Systems Catalog & Mail Order Houses Department Stores 7. Services(continued) Discount, Variety Stores Drug Stores Drugs Wholesale Education & Training Services Electronics Stores Electronics Wholesale Entertainment – Diversified Food Wholesale Gaming Activities General Entertainment Grocery Stores Home Furnishing Stores Home Improvement Stores Industrial Equipment Wholesale Jewelry Stores Lodging Major Airlines Management Services Marketing Services Medical Equipment Wholesale Movie Production, Theaters Personal Services Publishing – Books Publishing – Newspapers Publishing – Periodicals Railroads Regional Airlines Rental & Leasing Services Research Services Resorts & Casinos Restaurants Security & Protection Services Shipping Specialty Eateries Specialty Retail, Other Sporting Activities Sporting Goods Stores Staffing & Outsourcing Services Technical Services Trucking 8.Technology Application Software Business Software & Services Communication Equipment Computer Based Systems Computer Peripherals Data Storage Devices Diversified Communication Services Diversified Computer Systems Diversified Electronics Healthcare Information Services Information & Delivery Services Information Technology Services 8. Technology(continued) Internet Information Providers Internet Software & Services Multimedia & Graphics Software Networking & Communication Devices Printed Circuit Boards Processing Systems & Products Scientific & Technical Instruments Security Software & Services Semiconductor – Broad Line Semiconductor – Integrated Circuits Semiconductor – Specialized Semiconductor Equipment & Materials Semiconductor- Memory Chips Technical & System Software Telecom Services – Domestic Telecom Services – Foreign Wireless Communications 9. Utilities Diversified Utilities Electric Utilities Gas Utilities Water Utilities

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