FINC 5000 Financial Analysis Project The primary source of information for this report should be the company’s 10-K obtained from Edgar. Additional sources might include business periodicals, corporate home pages, and financial services reports (such as Value Line, Standard & Poor’s, or Moody’s). Place photocopies (or printouts) of the materials used in the appendix and provide proper attribution for all sources used. (At a minimum, the appendix should contain a copy of the four financial statements from the 10-K and any relevant notes to the statements.) However, do not include the entire 10-K reports especially if they are lengthy. Also, do not forget the executive summary at the beginning of your report.
I. Describe your company’s primary business activities. What business is the company in? What is its business model (how does it make money)? Include a brief historical summary, recent developments with the company and its industry, and other items of significance to your corporation. Include a short description of the company, its products and services and a discussion of the competitive situation. Industry information should include current trends and key success factors. Is the company in a profitable, growing industry? Limit: 4 pages. (All page limits refer to 8.5 x 11 pages, using 12-point type and double-spacing and standard margins)
II. Prepare common-sized statements of the balance sheets (2 years minimum). Identify significant trends and changes in the percentages. Describe your company’s major assets, liabilities and equities. Describe and evaluate the significant accounting policies (estimates and methods) related to these. (2 years minimum). Analyze your results. Limit: 2 pages.
III. Prepare common-sized statements of the income statement (2 years minimum). Identify significant trends and changes in the percentages. Describe your company’s major sources of revenues and expenses. Describe and evaluate the significant accounting policies related to these. Analyze your results. Limit: 2 pages. IV. Discuss your company’s major sources and uses of cash as reflected in the firm’s cash flow statements. Limit: 2 pages V. Ratio Analysis: Compute ratios listed in your text for the most recent 2 years. Perform a ratio analysis based on your results. The analysis must include a comparison with industry averages. Limit comments to 2 pages.
VI. Competitor Identification & Description. What’s the company’s competitive position and strategic vision? Does it have a strong brand? Is it a leader in its field? Is it gaining market share? For a major competitor in the same industry matched by approximate size to your target company collect 10-K or annual report for the time period suitable for comparison with your target company. Describe in an analytical fashion the operations and performance of each. Note significant financial policies. Use your target company as a standard for comparison. Use quantitative measures of performance (including ratios), as well as qualitative information from the financial reports. Tables and graphs will be useful for your exposition. Place photocopies of the financial reports, including the notes and any relevant excerpts from the Management Discussion and Analysis in the appendix. Limit: 4 pages of text total.
VII. Prepare a summary of the analysis of your company’s financial results as compared to other firms in the industry. Comment on significant amounts, trends and relationships. Evaluate your company’s prospects for the future. Do you have confidence in management and its ability and dedication to keep the company growing, to be straight with shareholders and to look out for their interests? What financial recommendations would you make to the Board?