Investment Analysis Paper on Ford Motor Group

Investment Analysis Paper on Your Company Name Here

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Investment Analysis Paper on Your Company Name Here

For seven weeks, you will be building this paper. Each week you will add a section and each week I will provide feedback. You will then incorporate my feedback and add a new section each week. In week seven, the paper will not only be a complete and thorough financial analysis, it might almost be perfect. In this document, I provide headings for you to follow. Use this introductory space to write a paragraph or two that presents basic business information (product, size, age, whatever) about your company.

It is an expectation of this assignment that you follow this template; the headings are provided to help you complete the assignment accurately. Remember that one paragraph of content is required between headings as a minimum and that a paragraph is a minimum of three sentences. Build you reference section each week and ensure that each reference is list in alphabetic order.

Board of Directors

Week one, select a publicly traded company that you wish to analyze for this paper. Submit the name to your Instructor for approval. Obtain the company's financial statements (annual report) and the most recent proxy statement. Using the information on the proxy statement, provide a board of directors as the headings below suggest.

Monitoring Potential of the Firm's Board of Directors

You will want to use level 2 headings within each weekly section.

Strengths and Weaknesses of Board Structure

Add your content here

Ethical Concerns

Add your content here

Competitive Financial Ratio Comparison

In week two, you will begin your analysis of the financial data. Remember to add this content to your week 1 paper; in other words, I will want to see that week 1’s feedback has been incorporated and I will see the new week 2 content, too.

DuPont Identity

You will want to calculate the DuPont identity for your company and as many competitors as you want. This area will require a table or an appendix or both. Recommend a table or appendix that includes this information.

Table 1

Raw Data for XYZ Company

Repeat the above table for the competitor(s).

Use the following equation

(1)

And another table that looks like this for the DuPont analysis.

Table 2

DuPont Analysis

Differences or Trends

Add your content here

Growth

In week three, you will analyze your company’s growth using the growth model.

Dividend Growth Model

This section will require a table or appendix or both. Add a comment or two regarding your findings – are they logical or feasible?

Table 3

Dividend and Stock Price Raw Data for Your Company

Table 4

Growth Rate for __________

Dividend Discount Model (DDM) = (2)

(3)

Issues with Using the Growth Model

Add your content here

Reasonableness of Constant Growth

Add your content here

Annual Report

Week four is the week you will read the annual report

Potential Real Options

Add your discussion here; are the options industry or company specific

Capital Budgeting Process

How would theses options affect your company’s budgeting process?

Beta

In week 5, you will discuss your company’s beta. Research investment websites as betas are published in several sources – no need to calculate.

Expected Return – CAPM

Present your calculations using a table, or a figure, or reference the appendix.

The average historical equity premium is 6.9%, so 7% is an estimate for the risk premium (Ross, Westerfield & Jaffe, 2013).

Dividend Growth Model versus CAPM

Add your discussion here

Debt and Equity

In week six, you will discuss your company’s debt and equity structure.

Equity

Discuss equity value and equity cost here – remember to use tables, figures, or appendix as appropriate.

Table 5

Market Value of Equity

Debt

Discuss debt value and debt cost here – remember to use tables, figures, or appendix as appropriate.

Table 6

Cost of Debt

Weighted Cost of Capital

Show your calculation of the weighted cost of capital here.

Table 7

Weighted Cost of Capital Raw Data

(6)

Capital Budgeting Assumptions

Any assumptions and difficulties?

Competitive Review of Debt and Equity Mix

And in our last week, you will compare your company’s debt and equity mix (see your prior work) to that of the competitors you discussed earlier.

Competitive Review

Repeat your WACC analysis from above for a competitor. This section will require a table or appendix or both.

Capital Structure Theories

General discussion here

Summary

Conclude Week seven with a current stock price analysis; given all of the analysis you performed above, would you invest in this company? Why or why not?

Reference

Ross, S. R., Westerfield, R. W., & Jaffe, J. (2013). Corporate finance (10th ed.). NY:McGraw-Hill.

Every week you will be adding citations and references so this section will grow accordingly. Be sure to use the hanging indent feature of the software to make formatting references simple.

Appendix A

Use when needed.

Appendix B

Appendix C