Financial Research Report Abby

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Financial Research Report

Abby Davis

Strayer University

Fin 534

Professor: Inez Black

November 21, 2021

Rational for Choosing the Company

               The client who I will be assisting in the most appropriate investment opportunity to go with is a relatively young man who is married with small twin children. He just got employed but intended to grow his capital to have adequate money for funding the children's education curriculum as they grow up. He is based on the category of retail or non-institutional investors since he wants to manage his own money. The most recommended stock for the man would be Annual Capital Management Inc. In essence, this is a growth stock that has shown consistent growth over the past years (Knapp, 2021). Besides, it is an entity that ensures its shareholders and investors obtain their dividends annually. It has a reasonable dividend yield of 10 percent, which indicates a safer environment for the investors' foreseeable future (Forbes, 2021). It is the right stock for the investor since it is based on retail investors, which the man is looking for. Besides, he can invest for short-term periods, allowing him to afford the school fees for these children on an annual basis.

Ratio Analysis

               Based on the entity's ratio analysis, the company is conservative, thereby having more ownership rights. This is an excellent indicator to ensure that the investors' capital will not be at the risk of being grabbed by the lender institutions if the obligations are failed to be met (CNN Money, 2021). Over the most recent years, the company has managed to retain its debt-Equity ratio above the mark of 5.0. Generally, the company's stock price for the last fifty weeks shows to be 8.65. Recently, however, the company reported a stock price of 9.64, which was an increase of the average (Macrotrends, 2021). This is a strong indicator for the investor that the company's overall financial health is stable. In other words, the company is showing good performance progress, thus guaranteeing a long-term period of returns. With this analysis, the man can invest in the company since it is financially stable (Hayes, 2012). The company has more of its assets in the company than it has liabilities. Therefore, his money will be safe from being snatched by the lender if the company fails to meet its obligation. It is also aligned with the man's goal of educating his twin children. When money is invested suitably, it means that there will be lower profitability of unacceptable losses. This also indicates a higher chance for the investors to obtain even higher returns in the future.

References

CNN Money. (2021). Stocks: Investing in stocks. Retrieved from;

https://money.cnn.com/pf/money-essentials-stocks/

Forbes. (2012). Six Rules to Follow When Picking Stocks. Retrieved from;

https://www.forbes.com/sites/benzingainsights/2012/06/15/six-rules-to-follow-when-picking-stocks/?sh=4913bcd55a2e

Hayes A. (2021). Value Investing. Retrieved from;

https://www.investopedia.com/terms/v/valueinvesting.asp

Knapp D. V. (2021). Dividend Growth Stocks As 'Strategic Beta' Investments. Retrieved from;

https://seekingalpha.com/article/3457406-get-your-smart-beta-dividend-growth-stocks-strategic-beta-investments

Macrotrends. (2021). Annaly Capital Management Inc Financial Ratios for Analysis 2005-2021 | NLY. Retrieved from;

https://www.macrotrends.net/stocks/charts/NLY/annaly-capital-management-inc/financial-ratios