Course Project

Course Project: A Financial Statement Analysis - A Comparative Analysis of Apple, Inc. and Alphabet, Inc.

Description

This course contains a Course Project, where you will be required to submit one draft of the project at the end of Week 6, and the final completed project at the end of Week 8. Using the financial statements for Apple Inc. and Alphabet Inc., respectively, you will calculate and compare the financial ratios listed further down this document and prepare your comments about the two companies' performances based on your ratio calculations. The entire project will be graded by the instructor at the end of the final submission in Week 8, and one grade will be assigned for the entire project.

Individual

It is recommended that the students begin their project no later than week 6, when the draft is due, and continue through the end of week 8, when the final project is to be delivered.

Note: You will be required to submit their individual project deliverables.

Financial Statements

Below is the link for the financial statements for Apple Inc. for the fiscal year ending 2020.

https://investor.apple.com/investor-relations/default.aspx (Links to an external site.)

When you arrive at this website, please do the following.

First, select SEC Filings, next select Annual Filings using the drop-down arrow labeled All Filings and then select 2020, using the drop-down arrow labeled Year,

You should select the 10-K dated 10/30/2020 and choose to download in PDF, HTML, or Excel format. The PDF format is the best format for searching.

Below is the link for the financial statements for Alphabet, Inc. for the fiscal year ending 2020.

https://abc.xyz/investor/previous/#numbersLink (Links to an external site.)

First, scroll down to the earnings section for 2020.  Click on the PDF link next to the Form 10-K. This will open the company's annual report.

A  Sample Project Template (Links to an external site.)  is available for download. The sample project compares the ratio performance of Nike and Under Armour using the 2014 financial statements of Nike and Under Armour provided at their websites.

Overall Requirements

For the Final Submission:

Your final Excel workbook submission should contain the following. You cannot use any other software but Excel to complete this project.

1. A Completed Worksheet Title Page tab, which is really a cover sheet with the names of each team member, the course, the date, your instructor's name, and the title for the project.

2. A Completed Worksheet Profiles tab which contains a one-paragraph description regarding each company with information about their history, what products they sell, where they are located, and so forth.

3. All 16 ratios for each company with the supporting calculations and commentary on your Worksheet Ratio tab. Supporting calculations must be shown either as a formula or as text typed into a different cell. The ratios are listed further down this document. Your comments for each ratio should include more than just a definition of the ratio. You should focus on interpreting each ratio number for each company and support your comments with the numbers found in the ratios. You need to specifically state which company performed better for each ratio.

4. The Summary and Conclusions Worksheet tab is an overall comparison of how each company compares in terms of the major category of ratios described in Chapter 13 of your textbook. A nice way to conclude is to state which company you think is the better investment and why.

5. The Bibliography Worksheet tab must contain at least your textbook as a reference. Any other information that you use to profile the companies should also be cited as a reference as well as the links to the financial statements.

Required Ratios for Final Project Submission

1. Earnings per Share of Common Stock

2. Current Ratio

3. Gross Profit Rate

4. Profit Margin

5. Inventory Turnover

6. Days in Inventory

7. Accounts Receivable Turnover

8. Average Collection Period

9. Asset Turnover

10. Return on Assets (ROA)

11. Debt to assets Ratio

12. Times Interest Earned Ratio

13. Dividend Yield 

14. Return on Common Stockholders' Equity (ROE)

15. Free cash flow

16. Price-Earnings Ratio [For the purpose of this ratio, look up the market price per share as of September 26, 2020, for Apple Inc. and for Alphabet, Inc. use December 31, 2020]

Note: The Excel files uploaded as the assignment submission should not include any unnecessary numbers or information (such as previous years' ratios, ratios that were not specifically asked for in the project, etc.).

Please upload your final submission to the Week 8 Assignments page by the Saturday ending Week 8.

For the Draft:

Create an Excel spreadsheet or use the project template to show your computations all 16 ratios listed above. The more you can complete regarding the other requirements, the closer you will be to completion when Week 8 arrives. Supporting calculations must be shown either as a formula or as text typed into a different cell. If you plan on creating your own spreadsheet, please follow the format provided in the Nike and Under Armour template file.

Please upload your draft submission to the Week 6 Assignments page by the Sunday at the end of Week 6.

Other Helpful Information:

Chapter 13 contains ratio calculations and comparison comments for two fictitious companies Chicago Cereal and Giant Mills so you will likely find this information helpful.

1. BigCharts.com (Links to an external site.) (Links to an external site.)  provides historical stock quotes.

APA style must be used to complete the references on your Bibliography tab. The Library contains information on APA formatting.