Complete project

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Group Project

This is a group project.

Please form groups of 2-3 students;

There will be one report per group.

This multiple part assignment has several due dates.

This assignment follows the outline provided in Chapter 14 (Comprehensive Case Study: Walmart Inc)

Select any publicly traded hospitality firm*

Assignment 1 – Sizing up your firm - Due June 25 th

2018

(i) Analyze the economy (ii) Analyze the industry (iii) Analyze your firm’s financial performance using ratio analysis**

Assignment 2- Projecting your firm’s future performance - Due July 2 nd

2018

(i) Create proforma income statements and balance sheets for the next two years (use spreadsheet in chapter 6)

(ii) Perform appropriate sensitivity analysis and alternate scenario, by varying the growth rate in sales and working capital variables (collection period, days sales in inventory and account

payable period)

Assignment 3 – Valuing your firm - Due July 22 nd

2018

(i) Compute the cost of equity for your firm (use CAPM; Assume the risk free rate is 4% and the market risk premium is 5%)

(ii) Compute the value of your firm (price per share) using the dividend discount model (fig 7-23) (iii) Compare the value you compute in part (ii) with the current market price of your firm. Is your

firm fairly priced?

Final Project Due: July 27 th

2018

Grading will be based on the following:

Presentation/Style: 15

Analysis: 50

Consistency (analysis and final evaluation): 35

The final project should be a formal report including references– typed double spaced 12 point font.

The final report should include the content of assignments 1,2&3 and be no more than 5 pages.

However, you can use an unlimited number of appendices, spreadsheets, graphs etc.

*The instructor must approve the firm selected by each group.

** You can download the firm’s financial statements from the library’s database Mergent On-line or

from the SEC filings (8K or 10K).