The company I selected was Nordstrom (the clothing store).
Objective
The specific objective of this exercise (written research project) is to give you an opportunity to complete a research project related to the material covered in the course. This assignment is an "Authentic Form of Final Assessment."
Analysis of Company's Stock
This project involves preparation of an analysis of a publicly traded company's common stock. Your task is to analyze and critique a company, using financial statements, an analyst's report(s), and other information, and then recommend the price ranges to buy, sell, or hold the stock.
You select a company to review and request me to approve that company by the end of week 1. The company must be a publicly traded company. The request must include:
a. identification of the company by ticker symbol and name
b. a reasonable and appropriate explanation of why you want to examine the alternative
company
c. the source of the analyst's report that will be used in the analysis (which must be
submitted to me)
d. acknowledgement by you that all of the specific elements of the assignment (see below) will be prepared by you and included in the final research project report
The project includes reviewing a professional analyst's report(s), examining analysts' earnings and performance projections, reviewing the firm's most recent annual Form 10-K report to the SEC and its annual report, and identifying and researching other sources of information about the company's performance and outlook.
The requirements of the assignment include, but are not limited to, reviewing the following:
a. overview and strategic analysis of the company, industry, and opportunities for
growth–It is strongly recommended that Porter's 5-factor framework for competitive
analysis be used.
b. financial analysis of the company and its competitive performance in the
industry—”This section must include a comparative financial ratio analysis of the
company, including historical comparisons (trend analysis) and comparisons to
competitors and the industry (cross-sectional analysis).
c. valuation discounted cash flow (DDM and FCF) and comparable (relative)
valuation—”This section must include:
a stock valuation using the dividend discount model (DDM)
2. a discounted free cash flow valuation (using ValuePro.net or other computerized
valuation model)
a valuation by comparable (relative valuation)
estimating the cost of common stock using the cost of asset pricing model (CAPM)
d. analysis of analysts' earnings projections and projected performance
historical stock price performance analysis and projected performance
development and defense of final recommendation through professional analysis and critical thinking
Special note: The analysis must evidence appropriate and thorough use and familiarity with the company's Form 10-K report, annual report, and recent earnings conference call.
Writing Requirements- Must be submitted in MSWord
A formal written report is required for this graded exercise. The suggested length of the final project is 5 to 7 pages, excluding, title page, index, exhibits and related documentation (reports, tables, etc.). The paper must be submitted as a MS Word file. If you decide to use spreadsheets, please use Excel, or send as a pdf. File.
The paper must begin with an introduction that reviews the assignment, or purpose, of the paper and includes an overview of the contents of the report.
The body of the report must address and include the specific elements of the assignment (outlined and explained above).
The paper should conclude with a summary or conclusion that provides an overview of the principal observations, conclusions and recommendations presented in the paper; no new material should be introduced in the summary or conclusion.
Essential research data, financial calculations, and other documentation to support the report should be referred to in summary form in the text of the written report and included as detail supporting information in the attachments. All major sources of information and data should be referenced. There is no set limit to the size or number of attachments and exhibits, but it is recommended that only essential supporting information and data be attached. You should use references and a bibliography to identify any remaining supporting documents used in the preparation of the written report.
To receive credit, the written research project report must be submitted by the due date; late papers are not accepted.
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finc_430_final_project.docx
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