Case analysis

Example of a position paper or Consultant’s Report:

December 1, 2019

To: The Board of Directors

From: Your Trusty Consultant

Subject: Outlook for the Baker Company

The condition of the Baker Company is poor in every respect. Their negative financial position is reflected in their lower stock price, increased debt, and declining sales. As a result, I recommend that we divest of all our holdings of Baker company stock as soon as possible.

Forbes magazine singled Baker out recently as an example of overpriced stock. (This statement can be supported with additional sentences explaining facts such as the current price of the stock compared to an earlier period).

Their debt has mounted to the point where it is eight times equity. (Additional sentences can be added here discussing a date and amount of debt at one time compared to another. Other companies in the same industry can be researched to provide relevant comparison data that would add to the point about increased debt).

Moreover, sales have declined from $1.1 million to $725,000 in only a few years. (Here you can give a history of the company, how it got started, its biggest products and/or customers, he type of industry, what differentiates it and gives it a sustainable competitive advantage).

Therefore, I recommend that we divest of all our shares of Baker Company stock immediately.