Applied Business Project 2

M I S 1 1 1 - C o m p u t e r s a n d t h e I n t e r n e t w o r k e d S o c i e t y

Applied Business Project 2 Guidelines

Eller College of Management

This document contains instructions on completing ABP-2 for MIS 111 Version 1.0 (Initial Release): 26 September 2022

Fall 2022

On-time Deadline for Completing the Submission of ABP-2

Wednesday, October 12, 2022 by 11:59pm

The D2L submission process (i.e., the upload of your report must finish and a confirmation message displayed by D2L) must be

completed by 11:59pm local Tucson time (MST or UTC/GMT-7) by the assignment due date. This is a hard deadline and no extensions

are offered to the on-time assignment due date, so be sure to plan your work and submission attempts accordingly.

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Table of Contents Assignment Overview ........................................................................................................................... 4

Introduction to Data Visualization ................................................................................................... 4

Finding Your Required Assigned Company .................................................................................. 5

IMPORTANT NOTE on using your assigned company .................................................... 5

No Cost Access to Data Sources for Analysis ................................................................................ 5

Task 1: ETL (Extract-Transform-Load) of Transactional Data ............................................ 6

Task 1 Self-Assessment Quality Review ............................................................................... 6

Extracting Data for Analysis from Yahoo! Finance ............................................................... 7

Task 1.1: Document your downloaded data .......................................................................... 8

Task 1.1 ............................................................................................................................................. 8

IMPORTANT NOTE: Use of the entire Task 1 dataset .................................................... 8

Task 1.2: Data Cleansing, Transformation and Analysis .................................................... 8

ETL Load Process .......................................................................................................................... 8

ETL Transform Process ............................................................................................................... 9

Creating a Stock Price Summary table for Task 1.2 ......................................................... 9

Task 1.3 Document the formulas used in the Stock Price Summary ........................... 9

Task 1.4: Data Visualization – Stock Trading Prices ......................................................... 10

Calculating the Task 1.4 data range and upper and lower bounds ......................... 10

Task 1.5: Data Visualization – Stock Trading Volume ..................................................... 11

Task 1.6: Data Visualization – Investment Analysis ......................................................... 12

Task 2: Comparative Market and Financial Strength ........................................................... 12

Task 2 Self-Assessment Quality Review ............................................................................ 12

Task 2.1: Tabular Data Representation ................................................................................. 13

Tasks 2.2, 2.3 and 2.4: Treemap Charts Visualizations ................................................... 13

Task 2.5: Value of a Treemap Chart in Investment Analysis ......................................... 14

Task 3: Corporate Sustainability Profile .................................................................................... 14

Task 3 Self-Assessment Quality Review ............................................................................ 14

Task 3.1: Tabular Data for Sustainability Visualization .................................................. 15

Task 3.2: Radar Chart Visualization for Sustainability .................................................... 16

Task 3.3: Sustainability Assessment ....................................................................................... 16

Task 4: Assessing your stock the Warren Buffet Way .......................................................... 17

Task 4 Self-Assessment Quality Review ............................................................................ 17

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IMPORTANT NOTE: Outcome of Investment Analysis .............................................. 17

Task 4.1: Selection of Criteria and Visualization ............................................................... 18

Task 4.2: Visualization Assessment ........................................................................................ 18

Task 4.3: Buffet Assessment Data Visualization ............................................................... 18

Options Available for Task 4 Buffet Investment Analysis Criteria ............................... 19

Task 4 Analysis Criterion 1: Is the company conservatively financed? ............... 19

Task 4 Analysis Criterion 2: Are earnings strong and show an upward trend? 19

Task 4 Analysis Criterion 3: Has the company been buying back its shares? ... 19

Task 4 Analysis Criterion 4: Is the company’s return on equity above average? ........................................................................................................................................................... 19

General Applied Business Project Report Guidelines ............................................................ 20

Required Business Report Formatting Elements ............................................................... 20

• Use the ABP-2 Report Template ................................................................................... 20

• Include with the E-tegrity Statement ......................................................................... 20

• Be submitted as a PDF-formatted document........................................................... 20

Citing Sources Required for Discussion Questions, Tables and Figures .................... 20

Required Table and Figure Formatting Checklist ................................................................... 21

Major Business Report Penalties ................................................................................................... 22

Not using the ABP-2 report template ...................................................................................... 22

Not submitting your report in PDF file format .................................................................... 22

Not using your assigned company ............................................................................................ 22

Not including the E-Tegrity statement ................................................................................... 22

Submitting an ungradable document ...................................................................................... 22

On-time Deadline for Completing Submission of ABP-2 ...................................................... 23

Wednesday, October 12, 2022 by 11:59pm .......................................................................... 23

Subject to Change Statement ........................................................................................................... 23

Changes and Errata List ..................................................................................................................... 23

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MIS 111 Applied Business Project 2

Assignment Overview

Your task for ABP-2 is to create a structured financial analysis report for your assigned company (as shown in your D2L grade book item “ABP Ticker”) from a data visualization perspective. Your business project report will include:

• Documentation on the process you used to extract, transform and load (ETL) information from a data repository (Yahoo! Finance) on your assigned stock;

• Charts visualizing key aspects of your stock’s trading data; • A treemap chart visualizing and comparing financial metrics; • A radar chart assessing the effectiveness of corporate sustainability; and, • An analysis and visualization of your stock using one selected Buffet criteria.

Introduction to Data Visualization

Not long ago, the ability to create smart data visualizations, or dataviz, was a nice-to-have

skill. For the most part, it benefited design- and data-minded managers who made a

deliberate decision to invest in acquiring it. That has changed. Now visual communication

is a must-have skill for all managers, because more and more often, it’s the only way to

make sense of the work they do.

Data is the primary force behind this shift. Decision making increasingly relies on data,

which comes at us with such overwhelming velocity, and in such volume, that we can’t

comprehend it without some layer of abstraction, such as a visual one. A typical example:

At Boeing the managers of the Osprey program needed to improve the efficiency of the

aircraft’s takeoffs and landings. But each time the Osprey gets off the ground or touches

back down, its sensors create a terabyte of data. Ten takeoffs and landings produce as

much data as is held in the Library of Congress. Without visualization, detecting the

inefficiencies hidden in the patterns and anomalies of that data would be an impossible

slog.

But even information that is not statistical demands visual expression. Complex systems—

business process workflows, for example, or the way customers move through a store—are

hard to understand, much less fix, if you cannot first see them.

Thanks to the internet and a growing number of affordable tools, translating information

into visuals is now easy (and cheap) for everyone, regardless of data or design skills. This

is largely a positive development. One drawback, though, is that it reinforces the impulse

to “click and viz” without first thinking about your purpose and goals. Convenient is a

tempting replacement for good, but it will lead to charts that are merely adequate or, worse,

ineffective. Automatically converting spreadsheet cells into a chart only visualizes pieces

of a spreadsheet; it doesn’t capture an idea.

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As the presentation expert Nancy Duarte puts it, “Don’t project the idea that you’re

showing a chart. Project the idea that you’re showing a reflection of human activity, of

things people did to make a line go up and down. It’s not ‘Here are our Q3 financial results,’

it’s ‘Here’s where we missed our targets.’”

Managers who want to get better at making charts often start by learning rules. When

should I use a bar chart? How many colors are too many? Where should the key go? Do I

have to start my y-axis at zero? Visual grammar is important and useful—but knowing it

doesn’t guarantee that you’ll make good charts. To start with chart-making rules is to

forgo strategy for execution; it’s to pack for a trip without knowing where you’re going.

Your visual communication will prove far more successful if you begin by acknowledging

that it is not a lone action but, rather, several activities, each of which requires distinct

types of planning, resources, and skills.

Scott Berinato “Visualizations That Really Work” Harvard Business Review, June 2016

Finding Your Required Assigned Company

The ticker symbol and name of your assigned company can be found on D2L in your grade book in the “ABP Ticker” item.

No Cost Access to Data Sources for Analysis

All information required for this assignment is available at no cost on the standard access Yahoo! Finance website at: https://finance.yahoo.com/ You are not required to purchase Yahoo! Finance Premium for this assignment. If you encounter data that is not accessible or blocked by a paywall, please contact an instructor for assistance with accessing the required information.

IMPORTANT NOTE on using your assigned company: You must use your assigned company, that is shown in the “ABP Company Ticker” item in your MIS 111 grade book on D2L

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While you may use other sources to obtain information, please contact an instructor if you are unsure whether an item is the required financial measure.

Task 1: ETL (Extract-Transform-Load) of Transactional Data

Task 1 Self-Assessment Quality Review [30 points]

Point Goal 0-7 points 8-15 points 16-22 points 23-30 points

Assessment (Based on the

specific criteria

defined for each subtask)

Did not attempt or missing

content in most or all tables

and/or written assessment or

citations

Missing major content in two or

more tables and/or written assessment and

citations

Missing some content in one

table or written assessment and

citations

Fully included most or all content in

tables, written assessment and

citations

For this task, you will perform many of the standard functions required to prepare data for data analysis in a business setting. When dealing with large volumes of data it is not possible to type the data in (as you may have done for ABP-1). This task takes you through many of the steps normally followed by information systems professionals when preparing data for analysis.

For this task, you will extract (download) data from Yahoo! Finance as an Excel “CSV” data file, transform (refine and select) your data, and then load (import) the data into Excel for visualization. This Extract-Transform-Load process is commonly referred to by information systems professionals using the acronym “ETL”.

What is an Excel CSV (Comma-Separated Value) file?

A CSV file is a comma-separated values file commonly used by spreadsheet programs such as Microsoft Excel or OpenOffice Calc. It contains plain text data sets separated by commas, with each new line in the CSV file representing a new database row and each database row consisting of one or more fields separated by a comma.

The CSV data exchange format is supported by many personal, business, and scientific programs. The format is especially useful in transferring tabular data between programs and databases because of its wide support. Since CSV files are saved as plain text you can open them with a plain text editor, such as Microsoft Notepad (Windows) and Apple TextEdit (MacOS).

(From: https://fileinfo.com/extension/csv)

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Extracting Data for Analysis from Yahoo! Finance

For Task 1.1, you will use Yahoo! Finance to extract the daily trading data for the most recent prior 12 months (52 weeks prior) starting with the day prior to the day you are collecting your data for your analysis. For example, if you download your data from Yahoo! Finance on September 26, 2022, your date range must include all trading days from September 27, 2021 to September 26, 2022, which represents the approximately 250 trading days during most calendar years.

To download the data, you will select the “Historical Data” tab on Yahoo! Finance, and

specify a “time period” date range () and “Daily” frequency (), then click the

“Apply” button (), and finally the “Download” hyperlink () shown below the “Apply” button, as shown below:

  



When your download is ready, your file saved in your “Downloads” folder, or you may be asked to confirm saving your file, as shown below:

Once you have downloaded your “CSV” data file, locate the file on your computer and open the file using a text editor, such as Notepad (on Windows) or TextEdit (OSX).

Do NOT use Excel or double-click on the filename to open the CSV file for task 1.1 (or other spreadsheet application), as this will not display the file correctly, as shown in Figure 1.1 below. For this step, right click (or long click) and select the program you want to select “open with” and then select your text editor application.

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Task 1.1: Document your downloaded data

Task 1.1: Open the CSV file using a text editor (not a spreadsheet application such as Excel) and copy the metadata (field labels on the first line) and only the first 10 rows (so 11 rows total, 1 header row and 10 data rows) of your stock’s CVS-formatted text data file into your report template.

The information MUST appear EXACTLY as shown below, with the first line of metadata showing the field names of the columns (e.g., “Date, Open, High…”) and the next 10 lines being comma-separated values (CSV) for only the first 10 days of the data range you specified in Yahoo! Finance for Task 1.1. Do NOT include all (over 250) data records from the CSV file.

Figure 1.1 – Selected Data from IBM Trading Data (Source: https://finance.yahoo.com/quote/IBM/financials?p=IBM)

IMPORTANT NOTE: Use of the entire Task 1 dataset For all other Task 1 subtasks (1.2-1.5), you must import and use the entire 52-week range (one year’s worth) of data. In other words, your analysis should be based on 250+ values representing all of the trading days that occurred during the 52-week range, and not just the sample first 10 items of the CSV file shown in Task 1.1

Task 1.2: Data Cleansing, Transformation and Analysis

To begin Task 1.2, clean and transform your data by:

ETL Load Process: This is importing the data into Excel. To import the data using the “From Text” option under “Get External Data” (in the Data ribbon).

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ETL Transform Process: Date Cleansing and Refining removes extraneous data. In this case, we will keep the “Adjusted Close” values and delete the “Close” values to allow us to compare different stocks more accurately. Once you have the data imported into Excel, use Excel to delete the “Close” column from the data, leaving only the Adjusted Close “Adj Close” column for your analysis.

Creating a Stock Price Summary table for Task 1.2

After you have completed your data cleansing and transformation, create a summary table of the 52-week range of your trading data showing the minimum, maximum, and range (high-low) of all the data (250+ values) each of the columns in your dataset (e.g., open, high, low, adjusted close, and volume).

To calculate the low and high values, you must use Excel’s “MIN()” and “MAX()” functions and then calculate each column’s the range (the difference between high and low) using an appropriate Excel formula.

The table for Task 1.2 should follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

Stock Price Summary- WMT (Walmart, Inc.)

(February 17, 2019 - February 17, 2020)

52-Week Category

Daily Open

Daily High

Daily Low

Daily Adjusted Close

Daily Volume

Low 97.12 97.40 95.00 95.52 2,227,400

High 124.60 125.38 120.70 121.28 22,504,200

Range 27.48 27.98 25.70 25.76 20,276,800

Table 1.2– Stock Price Summary Data Table

(Source: https://finance.yahoo.com/quote/WMT/holders?p=WMT Referenced 2/16/2020)

Task 1.3 Document the formulas used in the Stock Price Summary

For Task 1.3, you will show the Excel formulas or functions you used to calculate the Low (Task 1.3.1), High (Task 1.3.2), and Range values (Task 1.3.3), respectively, only for the values in the “Daily Open” column shown in red below.

Task 1.3 Task 1.4 Axis Bounds

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Task 1.4: Data Visualization – Stock Trading Prices

As the first step in your analysis, you will visualize your stock’s trading data using a horizontal line graph to display the stock price at the market opening, high, low and market close for Task 1.4.

Figure 1.4 – Walmart Intraday Stock Prices

(Source: https://finance.yahoo.com/quote/WMT/holders?p=WMT Referenced 9/29/2019)

The figure for Task 1.4 should follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

For Task 1.4, you must format the bounds of the trading price chart (vertical) axis must be set to +/- 20% more than the range of the data. As calculated in Task 1.2, you will use difference between the “Low” for the Daily Low and the “High” for the Daily High’s value, as highlighted in blue in the Task 1.3 sample table.

Calculating the Task 1.4 data range and upper and lower bounds To calculate your formatting bounds, subtract the lowest minimum value from the highest maximum value. Using the example shown with Task 1.3, the “Low” for the “Daily Low” is 95.00 and the “High” for the “Daily High” your high is 125.38, the range would be 30.38 (125.38-95.00), so 20% of this value would be 6 (rounded to the closest whole value). Using the 20% range of 6, you would subtract 6 from the “Daily Low” low (95.00-6) and adding 6 to the “Daily High” high (125.38+6). This would result in the bounds for your graph of 89 to 131.38.

Note that if your stock has wide trading range, you should set the lower bounds to zero, as opposed to a negative number for the lower bound of your graph.

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As shown below, to format an axis with an alternate bounds (or limits for your vertical axis) after creating your line graph, click on the axis values and right-click to open “Format Axis”. In the Format Axis options window, update the “Minimum” and “Maximum” Axis Options bounds, as shown below.

Task 1.5: Data Visualization – Stock Trading Volume

For Task 1.5, you will plot the Daily Volume of traded shares for the range of trading day as a vertical bar graph to display. You are not required to scale the vertical range (bounds) axis of this visualization.

Figure 1.5 – Walmart Traded Share Volume

(Source: https://finance.yahoo.com/quote/WMT/holders?p=WMT Referenced 2/16/2020)

The figure for Task 1.5 should follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

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Task 1.6: Data Visualization – Investment Analysis

For Task 1.6, write a 150-word original (i.e., in your own words) assessment (range: 125 – 175 words) of how an investment analyst could benefit from creating visualizations of trading data, such as Tasks 1.4 and 1.5 to predict future behavior of a stock. This analysis should consider how a stock trader’s understanding of the variations in the trading range, and open/close pricing visualization, and trading volume could inform their expectations for a stock’s future performance.

Your analysis should NOT discuss specifics related to your company’s stock performance, as shown in the visualizations in Tasks 1.4 and 1.5. When developing your solution to Task 1.6, be sure to justify your answer, and if you used a source to help you understand aspects of your solution, be sure also to include a citation.

Task 2: Comparative Market and Financial Strength

Task 2 Self-Assessment Quality Review [20 points]

Point Goal 0-5 points 6-10 points 11-15 points 16-20 points

Assessment (Based on the

specific criteria

defined for each subtask)

Did not attempt or missing

content in most or all tables

and/or written assessment or

citations

Missing major content in one or

more tables and/or written assessment and

citations

Missing some content in one

table or written assessment and

citations

Fully included most or all content in

tables, written assessment and

citations

Comparative market and financial strength are often a key metrics stock traders use to assess the value of a stock. For this task, you will create a “Tree Map” visualization your stock’s total assets, total liabilities, and total stockholder equity for your company, a competitor, and one company from an unrelated industry of your choice. You should use the data from each company’s the most recent reported fiscal year (the fiscal year closes are not required to be the same).

According to DataScience.com, the treemap was invented by Ben Shneiderman. Dr. Shneiderman created the treemap to visualize hierarchical data. Martin Wattenberg created a slight variation on this, referred to as a clustered treemap, which is what most people today commonly refer to as a treemap. A treemap chart is a visual method for displaying hierarchical data that uses nested rectangles to represent the branches of a tree diagram. Each rectangles has an area proportional to the amount of data.

(See: https://www.dataplusscience.com)

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Task 2.1: Tabular Data Representation

For Task 2.1, create a table showing the Total Assets, Total Liabilities, and Total Shareholder Equity (from the most recent fiscal year) for your company (Task 2.2), an industry competitor (Task 2.3), and any company outside your company’s industry (Task 2.4). Since all three companies are shown on the same table, be sure that you report the values using consistent units (e.g., “shown in billions”), as shown below.

Figure 2.1 – Comparative Market and Financial Strength Analysis (shown in billions) (Source: https://finance.yahoo.com/ Referenced 1/16/2020)

The table for Task 2.1should follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

Tasks 2.2, 2.3 and 2.4: Treemap Charts Visualizations

For Tasks 2.2, 2.3, and 2.4, using the financial data (assets, liabilities and shareholder equity) from Task 2.1, create three (3) treemaps: one treemap for your company, one treemap for an industry competitor, and one treemap for any company outside your company’s industry.

Figure 2.2 – Company Financial Profile (shown in billions)

(Source: https://finance.yahoo.com/ Referenced 1/16/2020)

The figures for Tasks 2.2, 2.3, and 2.4 should follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

Company Assets (B) Liabilities (B) Equity (B)

WMT 219.295 144.799 74.496

TGT 41.29 29.993 11.297

IBM 153.186 132.345 20.841

Market and Financial Stregth

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Task 2.5: Value of a Treemap Chart in Investment Analysis

For Task 2.5, write a 150-word original (i.e., in your own words) analysis (range: 125 – 175 words) describing how using a treemap chart to display a consolidated view of the market and financial information of several companies would better inform an investor’s analysis evaluating an investment opportunity.

Note that your analysis should NOT discuss specifics related to your company’s stock performance, as indicated by the visualizations in Tasks 2.2, 2.3, and 2.4, on the ways in which a treemap would inform decisions about investment opportunities generally.

Task 3: Corporate Sustainability Profile

Task 3 Self-Assessment Quality Review [25 points]

Point Goal 0-6 points 7-12 points 13-18 points 19-25 points

Assessment (Based on the

specific criteria

defined for each subtask)

Did not attempt or missing

content in most or all tables

and/or written assessment or

citations

Missing major content in one or

more tables and/or written assessment and

citations

Missing some content in one

table or written assessment and

citations

Fully included most or all content in

tables, written assessment and

citations

Sustainability is another key factor for a number of investors, particularly those who want to support companies practicing sustainable stewardship.

For this task, you will create a “radar” chart showing sustainability profiles for your company, a competitor, and one company from an unrelated industry of your choice, and then prepare a short analysis of what its sustainability profile might mean for its stock. You may use the same competitor and company outside your company’s industry for this task as you did for the tasks in Section 2.

As described by Yahoo! Finance, Sustainalytics’ ESG Risk Ratings assess the degree to which a company’s enterprise business value is at risk driven by environmental, social and governance issues. The rating employs a two-dimensional framework that combines an assessment of a company’s exposure to industry-specific material ESG issues with an assessment of how well the company is managing those issues. The final ESG Risk Ratings scores are a measure of unmanaged risk on an absolute scale of 0-100, with a lower score signaling less unmanaged ESG Risk.

(See: Finance.Yahoo.com)

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According to DataScience.com, radar charts are a great way to compare members of a dimension in a function of several metrics. For example, when you want to buy a smartphone, you can use a radar chart to compare several devices across several metrics like battery life, camera quality, and memory capacity.

(See: https://www.dataplusscience.com/ChartChatS1E1.html)

As described by HistoryofInformation.com, the radar diagram was originally developed in 1858 by nurse, statistician, and reformer Florence Nightingale showed that epidemic disease, which was responsible for more British deaths in the course of the Crimean War than battlefield wounds. The graphic, which Nightingale used as a way to explain complex statistics simply, clearly, and persuasively, has become known as Nightingale's "Rose Diagram."

(See: https://www.historyofinformation.com/detail.php?entryid=3815)

Task 3.1: Tabular Data for Sustainability Visualization

For Task 3.1, you will create a table showing the Environment Risk Score (ERS), Social Risk Score (SRS), and Governance Risk Score (GRS) for your assignment company, an industry competitor, and any company outside your company’s industry. While you may use the same three companies used in Task 2, you may have to select alternative companies if the companies you selected do not have ESG Risk Ratings.

Risk Factor WMT AMZN TSLA

Environment (ERS) 3.4 6.7 3

Social (SRS) 17.3 14.6 17.3

Governance (GRS) 6.5 9.7 10.2

Task 3.1 – Sustainavalytics ESG Rating Comparison

(Source: https://finance.yahoo.com/ Referenced 9/26/2021)

The table for Task 3.1 should follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

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Task 3.2: Radar Chart Visualization for Sustainability

For Task 3.2, create a single “radar” chart incorporating the values for all three companies Sustainanalytics Environmental, Social and Governance (ESG) Ratings comparison using the information from the table in Task 3.1.

Task 3.2 – Sustainanalytics ESG Ratings Comparison Visualization

(Source: https://finance.yahoo.com/ Referenced 9/26/2021)

The figure for Task 3.2 should follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

Task 3.3: Sustainability Assessment

Sustainanalytics’ ESG Risk Ratings measure a company’s exposure to industry-specific material ESG risks and how well a company is managing those risks. This multi- dimensional way of measuring ESG risk combines the concepts of management and exposure to arrive at an absolute assessment of ESG risk that could impact a company’s enterprise value. (See: https://www.sustainalytics.com/ )

For Task 3.3, write a 150-word original (i.e., in your own words) analysis (range: 125 – 175 words) describing how individual investors might use information on Sustainalytics’ ESG Ratings to inform their investment decisions on either a company’s commitment to sustainable business practices or how well a company is managing material ESG risks in its business operations. Be sure to justify your answer, use an online source to inform your discussion and include a citation, including the date you referenced the online sources.

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Task 4: Assessing your stock the Warren Buffet Way

Task 4 Self-Assessment Quality Review [25 points]

Point Goal 0-6 points 7-12 points 13-18 points 19-25 points

Assessment (Based on the

specific criteria

defined for each subtask)

Did not attempt or missing

content in most or all tables

and/or written assessment or

citations

Missing major content in one or

more tables and/or written assessment and

citations

Missing some content in one

table or written assessment and

citations

Fully included most or all content in

tables, written assessment and

citations

As Charles Rotblut, a contributing editor for Forbes.Com, observes, Warren Buffett believes that a successful stock investment is a result first and foremost of the underlying business. Its value to the owner comes from the company’s ability to generate earnings at an increasing rate each year. Buffett seeks first to identify an excellent business and then to acquire the firm if the price is right.

Buffett is considered a value investor, and seeks out consumer monopolies, selling products where there is no effective competitor, due to either a patent or brand name or similar intangible that makes the product or service unique. Moreover, Buffet typically passes up the stocks of commodity-based firms even if they can be purchased at a price below the intrinsic value of the firm.

(See: Investing The Warren Buffett Way on https://www.forbes.com)

For task 4, you will evaluate your assigned company’s investment potential with respect to concepts related to Warren Buffett’s investment strategies using one of the four “Buffet Investment Criteria” shown below.

IMPORTANT NOTE: Outcome of Investment Analysis For Task 4, you should assess your company in the context of one of the criterion. You are not expected to justify that your company meets the criterion or would be a good investment choice. However, your analysis must provide a specific basis for why you believe that your company either meets or fails to meet the requirements for your selected criteria.

For this task, consider that you are an investment analyst for Warren Buffet and he has asked you to evaluate your company, given one of his criteria. To do this task, you will need to select one of the criteria, identify financial data that would be appropriate to assess that criteria, and then visualize the financial data you select.

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Your solution for this task will be assessed on (1) your selection of appropriate data to describe the criterion, (2) your selection of a visualization that presents the data with the greatest clarity, and (3) your analysis of your company given the selected criterion. In other words, have you thought critically about the meaning of your selected criterion and demonstrate an understanding of how the data and its visualization can inform an investor.

When selecting a criterion, you should use one of Warren Buffet’s approaches: “Do you understand how it works?” Since you can select any of the criteria, you should consider whether you fully understand the criterion, whether you can find data that would inform its analysis, and whether the data lends itself to visualization.

Task 4.1: Selection of Criteria and Visualization

For Task 4.1.1, select one (1) of the criteria, shown below in “Task 4 Buffet Investment Criteria”, for this task. Your answer should include both the identifier and the descriptions of your criterion from the list shown below (e.g., “Analysis Criterion 1: Is the company conservatively financed?”) for this question.

For Task 4.1.2, select a specific visualization (e.g., a type of chart or graph) you recommend using to best inform an investor about the criterion that you selected for this task. You may select any chart or graph style (e.g., line or bar graph, pie chart, waterfall chart, radar chart, or treemap graph); however, you may not select a table or a bulleted list of information as your visualization method. For Task 4.1.2, you only need to include the name of visualization included as Task 4.3, not the visualization itself.

Task 4.2: Visualization Assessment

For Task 4.2, write a 150-word original (i.e., in your own words) analysis (range: 125 – 175 words) describing how you understand how your proposed visualization would inform an investor about the selected criterion. Note that you will not be assessed on whether your assessment is a correct interpretation of the use of the criterion or visualization, just upon the strength and clarity of your analysis.

In addition, you should assess whether or not your assigned stock, based the information presented in your visualization, meets the requirements for a quality investment using the Buffet criteria you selected. Be sure to justify your answer, include any sources you used to inform your discussion, with appropriate citations.

Task 4.3: Buffet Assessment Data Visualization

For Task 4.3, using the appropriate financial data, create the visualization you proposed in Task 4.1.2 for your assigned stock. While you may use any source for the data for your visualization, data is available at no cost on Yahoo! Finance that will

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meet the requirements for all of the options. The chart or graph visualization included for Task 4.3 must follow the “Required Table and Figure Formatting Checklist” shown in the “General Applied Business Project Report Guidelines” section.

Options Available for Task 4 Buffet Investment Analysis Criteria

You must select one of the following investment criteria that were adapted from material originally published in the book Warren Buffet Way for your analysis. Since each of the criterion considers a different perspective of the valuation of a company, you are encouraged to select a criterion that you understand and that is well aligned with the information available for your assigned company.

In the article The Buffett Approach to Valuing Stocks published in Pepperdine University’s Graziadio Business Review, Steven Ferraro discusses the process Warren Buffett uses to determine the intrinsic value of a publicly traded stock.

see: http://gbr.pepperdine.edu/2010/08/the-buffett-approach-to-valuing-stocks/

Task 4 Analysis Criterion 1: Is the company conservatively financed?

Buffett seeks out companies with conservative financing, such as companies with total liabilities relative to total assets that are below the median for their respective industry, low debt to capitalization or low debt to equity. For the purposes on this analysis, you may use the average of 2 (two) competitors in the same “industry,” as shown on Yahoo! Finance in the “Company Profile” shown on the Summary page. Task 4 Analysis Criterion 2: Are earnings strong and show an upward trend?

Buffett looks for companies with strong, consistent, and expanding earnings. While Buffet screens for companies with 7-year earnings per share growth greater than 75% of all firms and consistent earnings; however, for this analysis, you are only required to use the 3 years available at no cost on Yahoo! Finance. Task 4 Analysis Criterion 3: Has the company been buying back its shares?

Buffett prefers that firms reinvest their earnings within the company, provided that profitable opportunities exist. When companies have excess cash flow, Buffett favors shareholder-enhancing maneuvers such as share buybacks. Task 4 Analysis Criterion 4: Is the company’s return on equity above average?

Buffett considers it a positive sign when a company is able to earn above-average returns on equity. Mary Buffett indicates that an average return on equity is approximately 12% over the most recent 7 fiscal years; however, for this analysis, you are only required to use the 3 years available at no cost on Yahoo! Finance.

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General Applied Business Project Report Guidelines

Required Business Report Formatting Elements

In order to receive full credit for your assignment, your structured business report must use the ABP-2 assignment template (available in the ABP-2 assignment folder on D2L), include the required “E-Tegrity” statement, and be submit your report formatted as PDF file.

REQUIRED Text for E-Tegrity Statement

Citing Sources Required for Discussion Questions, Tables and Figures

You should always cite the source of any data you use, whether it is narrative information or numeric financial performance information. If your source is from a document you found online, your citation must include the source’s URL and the date you referenced the material. Although it does not follow the requirements for style sheets used on formal paper (i.e., MLA, APA, etc.), for our applied business projects, you are only required to include the root URL. An example of a citation that you would use for historical quote data from http://www.google.com/finance would be:

(Source: http://www.google.com/finance accessed on 2/4/2011)

All web pages (including Yahoo! Finance) that have been accessed as sources of data for a task or section should be cited. Citations must be used when the information you included was not your own work, and included either directly below a written paragraph or as part of the caption, as shown in the guidelines.

It is not acceptable to use a “works cited” list at the end of your report.

For full credit, your structured business report MUST:

• Use the ABP-2 Report Template • Include with the E-tegrity Statement • Be submitted as a PDF-formatted document

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Required Table and Figure Formatting Checklist

When preparing the table and figures in your report, it is not sufficient simply to include the required data. Always be sure that your work is professionally formatted and is formatted in accordance with the graphical style presented with each task. When preparing your final PDF report, ensure that your tables and figures:

• follow the example shown in the style sample for metadata, including: o for figures, appropriate labels and legends for titles, labels for axes, and, o for tables, appropriate headers, column widths, and data formatting;

• are clear and easily readable, and are placed within the margins of your report; • are sized and formatted so that there are not any page breaks; • include a caption and citation (of your source) under each figure;

Also, we recommend cutting-and-pasting the graphs directly from your spreadsheet into your assignment report. If you are using a Windows environment, you would select the figure in Excel and then use the ‘Paste Special’ in MS Word as a “Picture (enhanced metafile).” If you are using MacOS, you would use “Paste Special” as a “PDF”. Since the details of your graph must be readable, using a screenshot (Windows Snip or MacOS Grab) image is not recommended.

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Major Business Report Penalties

Criteria Penalty

Not using the ABP-2 report template Even if we can open and grade your assignment, if you do not use the ABP-2 assignment template to prepare your report, a 10 point penalty will be deducted from your score.

-10 points

Not submitting your report in PDF file format Even if we can open and grade your assignment, if you submit your report in any other format (e.g., Word or Pages), a 10 point penalty will be deducted from your score.

-10 points

Not using your assigned company, as shown in the “ABP Ticker” item in your MIS 111 grade book on D2L If you use any other company than the company assigned in your D2L grade book, a 20 point penalty will be deducted from your assignment grade.

-20 points

Not including the E-Tegrity statement in your report as shown above and also included in the template file is not included in your report, as shown the template file, a 20 point penalty will be deducted from your assignment grade.

-20 points

Submitting an ungradable document (i.e., anything other than your project report solution, such as an incorrect file from another assignment, blank assignment template, or a document that cannot be opened You will not receive any credit for the assignment. However, you may still submit your report for partial credit, which has a 20 point penalty.

-100 points

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On-time Deadline for Completing Submission of ABP-2

As a reminder, the system clock for D2L solely determines the submission time for an assignment, not your personal device. Moreover, please remember that that Arizona does NOT observe daylight savings time, and the assignment deadline time is based on local Arizona time (MST or UTC/GMT-7), as determined by D2L’s system clock.

Therefore, you are strongly encouraged to submit your assignments early, preferably before 11:30pm. Since it is solely your responsibility to ensure that your assignment to D2L has been fully uploaded and acknowledged with a confirmation message by D2L prior to the published deadline. No extensions will be given due to slow system performance, network problems, or any other issues affecting your ability to submit your report by the deadline.

Subject to Change Statement

The information contained in these guidelines, other than the assignment’s total point value for the course grading rubric, may be subject to change with advance notice, as deemed appropriate by the instructor, including, but not limited to typographical errors, factual errors, omissions, or other material included herein as needed to reflect the requirements of the course correctly.

Any changes made to the assignment’s guidelines will be announced during a Flex/In- Person class discussion and updated guidelines posted in the assignment’s folder. You are responsible for all announced changes to the assignment’s guidelines. If you have any questions or concerns regarding any changes to the assignment guidelines, please contact the Instructional Team at [email protected]

Changes and Errata List

Changes made to the schedule are documented below and announced on D2L.

• Initial Release: 26 September 2022

Wednesday, October 12, 2022 by 11:59pm The D2L submission process (i.e., the upload of your report must

finish and a confirmation message displayed by D2L) must be completed by 11:59pm local Tucson time (MST or UTC/GMT-7) by

the assignment due date. This is a hard deadline and no extensions are offered to the on-time assignment due date, so be sure to plan

your work and submission attempts accordingly.

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Online Sources of Financial Information

1) The Investor Relations section of your company’s website

An important source of financial information for any company can be found in the “investor relations” section of your company’s corporate website.

2) Financial Reporting Websites

• Yahoo: http://finance.yahoo.com/ (recommended) • Money: http://money.cnn.com/ • Google: http://www.google.com/finance • NASDAQ: https://www.nasdaq.com/ • NYSE: https://www.nyse.com/

Many of these online services offer current and historical stock pricing, financial information, corporate background, and other investment information. While some financial terms are unique to each site, the guidelines generally reflect terminology used on Google Finance and Yahoo Finance.

3) Dictionaries to investment terms

• http://www.Investopedia.com This website offers definitions of investment terminology and formulas to investment metrics used in this assignment.

4) Financial Analysis Websites

• http://www.Reuters.com Thomson Reuters is the world's largest international multimedia news agency, providing investing news, world news, business news, technology news, headline news, small business news, news alerts, personal finance, stock market, and mutual funds information available on Reuters.com,

• http://www.bloomberg.com/ One of the best financial websites out there, Bloomberg is all about up-to-date business analysis and financial data. The site has a good personal finance section with news supported by videos and four calculator tools.