Corporate Finance

MGT 231 - Corporate Finance

Team Project

https://www.sec.gov/edgar

This project will consist of compiling information and providing an analysis of a publicly traded company assessing risks, investment returns, and overall valuation. This project must be completed in your groups, each person providing input to the overall project, and should be done so that the final product is a PDF report.

Each report should have a cover page (most creative/humorous cover page wins an additional prize), along with the below content - aggregate all information and analysis into a report providing the below criteria in organized sections. Reports should be fluid and consistent in nature.

Company Introduction

Provide an introduction to the company you are reporting by describing the company’s business - translate into your own words a consolidated overview of the “Business” section of the company’s most recent 10-K filing (Item 1, Part 1).

Company Risks

Provide an overview of the risks the company faces - translate into your own words a consolidated overview of the “Risk Factors” section of the company’s most recent 10-K filing (Item 1A, Part 1). Also include an overview of the market risk of the company - in your own words, translate the “Quantitative and Qualitative Disclosures about Market Risk” section (Item 7A - Part 2).

Time Trend Analysis

Provide an annual time-trend analysis of the following financial ratios for the previous three years. Provide tables and charts of your calculations along with a written summary analyzing each of the calculated ratios, if applicable.

· Short-Term Solvency & Liquidity

· Current Ratio

· Quick Ratio

· Long-Term Solvency

· Total Debt Ratio

· Asset Management & Turnover

· Inventory Turnover

· Days' Sales in Inventory

· Receivables Turnover

· Days' Sales in Receivables

· Profitability

· Profit Margin

· EBITDA Margin

· Return on Assets

· Return on Equity

· Market Value

· Price-Earnings Ratio

· Market Capitalization

Peer Group Analysis

Provide a peer group analysis [of three similar companies] of the following financial ratios for the previous fiscal year. Provide tables and charts of your calculations along with a written summary analyzing each of the calculated ratios, if applicable.

· Short-Term Solvency & Liquidity

· Current Ratio

· Quick Ratio

· Long-Term Solvency

· Total Debt Ratio

· Asset Management & Turnover

· Inventory Turnover

· Days' Sales in Inventory

· Receivables Turnover

· Days' Sales in Receivables

· Profitability

· Profit Margin

· EBITDA Margin

· Return on Assets

· Return on Equity

· Market Value

· Price-Earnings Ratio

· Market Capitalization

Peer Group Explanation

Provide a brief explanation [for each company] as to your reasoning for choosing the three comparable companies in the previous section - Peer Group Analysis.

Common Size Financials

Convert the consolidated Income Statement and Balance Sheet into common size financials for the most recent fiscal year in comparison to the same companies in the peer group ratio analysis. Analyze the statements and provide an explanation of your analysis.

Stock Valuation

Calculate and chart the company’s current stock price under various scenarios.

· Zero Dividend Growth

· Constant Dividend Growth (dividends are expected to grow at 3% per year)

· Free Cash Flows

· Assume revenues are expected to grow at 10 percent per year for two years, then 8 percent per year for the following two years, then at 6 percent per year after that.

· Assume all expenses are proportional to revenues based on the most recent fiscal year.

· Assume analysts are expecting dividends to grow 5% per year, indefinitely.

· Assume standard corporate tax rate of 35%.

If your company does not have a current dividend, assume they will be paying a dividend of 1% of their current stock price next year. Stock price and dividend information can be referenced in the company’s most recent 10-K filing (Item 5, Part 2).

Percentage Returns

Calculate and chart the following returns for the previous three fiscal years.

· Dividend Yield

· Capital Gain

· Total Return

· Arithmetic Average Return of Total Return

· Geometric Average Return of Total Return

Company Overview

Provide a brief synopsis of the company referring back to your research, reported information and analysis.

Grading Breakdown

Below is a detailed breakdown of the grading structure for this project. The grading for this project is very simplified and analyzes completeness of each section along with accuracy by cross-referencing the 10-K filings of the company.

The data put in appendix

Section	Completeness	Accuracy	Total
Company Introduction	5	5	10
Company Risks	5	5	10
Time Trend Analysis	5	10	15
Peer Group Analysis	5	10	15
Peer Group Explanation	5	5	10
Common Size Financials	5	5	10
Stock Valuation	5	5	10
Percentage Returns	5	5	10
Company Overview	5	5	10
Total	45	55	100