Part 2 (75 points) Financial Analysis
This part covers the financial analysis of your calculated financial ratios (in word processor file and name it f322part2proj_lastname and initial). Please use complete sentences in analyzing the financial ratios.
Section 1 (10 points) Industry Analysis
(Source of information in FLITE - Standard and Poor�s Net Advantage) Stock report.
Write a brief analysis of the industry or sub-industry your company belongs to (this is an industry overview!):
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Finc 322 Financial Analysis Project Browers
� Name of the industry and/or sub-industry
� Brief Description of the major products/services of the industry or sub-industry, size in terms of sales and profits, significant developments, and future outlook
� List and briefly describe the five major competitors in the industry
� Get analysts forecast on the future outlook (one year) for the industry (indicate source)
Section 2 (15 points) Business Analysis
Business Analysis (Source: Go to the company�s homepage, go to the Investors Relations tab, and then go to the Stockholder�s Report.)
Write a brief business analysis of your company (please use complete sentences):
� Indicate the industry classification. Include NAICS code.
� Brief business history�beginning of the company, who started it, where it was started, what products were produced and how it grew to the current company size.
� Products/services the firm produces today, contribution of each product in terms of sales and profit, where the products/services are sold, pace and size of the market.
� The size of the firm in terms of revenues, number of employees, assets and market value and current competitiveness.
� the current officers,
� Two analysts forecast of the company�s sales and profits next year (indicate source).
Section 3 (40 points) Financial Ratio Analysis
Copy the financial ratios for each group from excel file you have completed above to your word file. Copy and evaluate each ratio within each group. (Note: A good source of financial ratio definitions is in www.investopedia.com)
Evaluate the financial ratios. Compare each ratio to the industry ratio and S&P 500 ratio. Explain what the ratio measures and indicate if your company is doing better or worse than the industry and S&P 500, and why. Look at the student example posted in FerrisConnect to see how to write the analysis.
Make sure that you refer to the actual number when you evaluate and compare the ratios.
Example: Aapl (Source: cnbc.com 1/22/2013)
VALUATION
AAPL.O
Industry Average
Worse
Same
Better
S&P 500
Worse
Same
Better
Price/Earnings (TTM)
11.33
13.56
X
19.95
X
Price/Cash Flow
9.24
9.29
X
11.5
X
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