final business report - course project

Alibaba Group Holding Limited was trading at $84.49 when the stock is picked for the analysis and now the stock is trading at $99.25, generating a return of 17.47% in 40 days. The main reason behind in such a stock appreciation is because of positive news about the company as they reached the highest revenue growth since 2014.

Amazon.com Inc. was trading at $744.86 when the stock is picked for the analysis and now the stock is trading at $772.44, generating a return of 3.70% in 40 days. Amazon.com rose 1.8 percent, pushing up its market capitalization by about $6 billion to around $361 billion and blew past Wall Street expectations for both profit and revenue.

.

Ford Motor Company was trading at $13.84 when the stock is picked for the analysis and now the stock is trading at $12.5, generating a return of -9.68% in 40 days. The biggest reason behind in stock depreciation was that as they recalled 48, 700 SUV in India due to failure reasons which hit their revenue and profit.

General Motor Company was trading at $32.16 when the stock is picked for the analysis and now the stock is trading at $32.16, generating a return of 0% in 40 days. We can see from the stock chart that prices move in sideways or in consolidation phase. There may be no of reasons like there is no positive or bad news come out from the company or their competitors giving them tough competition.

Apple Inc. was trading at $98.66 when the stock is picked for the analysis and now the stock is trading at $107.73, generating a return of 9.19% in 40 days. The stock is quite volatile as we can see from the stock chart, also stock price may go down in the coming days as European Union ordered Apple Inc. to pay Ireland unpaid taxes of up to 13 billion euros ($14.5 billion).

Do any of the firms selected have preferred stock or convertible investments available? If so, how do these investments compare and contrast to the common stock ones you have been following?

Difference between preferred stock and common stock

Holders of common shares can participate in the decision making process .They are entitled to receive dividends declared by the company and if the company goes bankrupt they have a claim on the company assets after all other claims have been satisfied.

Preferred shareholders have a higher priority in claims on dividends any on company assets in case of liquidation. They are entitled to receive fixed dividends on a regular basis.

Preferred stock is less risky than common stock because dividends on preferred stock is fixed and certain, reducing the uncertainty about future cash flows.

Preferred shares can also be convertible to common stock, these are convertible into a specified no of common shares based on conversion ratio that is determined at issuance.

They are advantageous to investors:

· They allow investors to earn a higher dividend than if they had invested in company common shares.

· They offer the investors the opportunity to share the profits of the company.

· They allow investors to benefit from a rise in the price of common shared through the conversion option.

Options Warrants: Holders of warrants have the right to purchase an entity common stock at a pre-specified price at or before the warrants expiration date.

Alibaba Group Holding Limited does not have any preferred stock but they do have stock options warrants whose current worth is $54 million which gives the investors the chance or right to purchase an entity common stock at a pre-specified price at or before the warrants expiration date. This current worth is half less than the previous year worth which shows that many investors had exercised the option.

Amazon.com Inc., Apple Inc. and General Motor Company does not have any preferred stock, warrants options or convertible investments.

Ford Motor Company does not have any preferred stock but they do have stock options warrants whose current worth is $94 million. This current worth is 1/4 of the previous year worth which shows that many investors had exercised the option.

References

Financial Reporting analysis (2016 level I CFA program curriculum, volume 3)” (n.d.).