this is an accounting assignment , the instructions are in the attached file.
heisenberg1809
instructions-_fin_analysis_proj-spr17-1.docx
ACCT2-SPR17
FINANCIAL ANALYSIS PROJECT
Online research:
Go to: http://morningstar.com
Select a PUBLIC Company (U.S.-based (not foreign) that you would like to research;
Insert company name or stock symbol into “Quote” box at top of page
Note 1: If more than one company name/stock symbol results from search, click on the company you have chosen. Make sure it is NYSE or NASDAQ.
Note 2: If company name does not work, it may be owned by another company;
(Google: “name of company”+parent) or choose another company
Note 3: Do NOT choose a financial institution (bank, insurance company, brokerage firm, etc.)
Note 4: Recommend choosing large, profitable companies
Click on Financials tab
- Make sure you set:
Statement Type: ANNUAL
Data Type: RESTATED
Period: 5 YEARS
Show Report Dates: DESCENDING
PRINT INCOME STATEMENT
Click on Balance Sheet tab
PRINT BALANCE SHEET
- Make Sure Detail of Current Assets is shown (arrow pointed down)
PRINT CASH FLOW STATEMENT
Click on “Quote”tab
PRINT OVERVIEW Page(s)
PRINT COMPANY PROFILE
Print-outs of five pages (Income Statement, Balance Sheet, Cash Flow Statement, Overview and Company Profile) MUST be submitted
Complete the attached worksheets.
Due Date: Wednesday, April 19, 12:45pm; no e-mail submissions
Maximum score equals 10 points. Late submissions will be accepted with loss of 1 point per class late.
Assignment is to be done on an INDIVIDUAL basis; assignment points for any “group” work will be split among the group
Name___________________________________
Company Name__________________________
(1) Vertical Analysis
(a) Calculate Vertical Analysis of Income Statement for the last TWO years (most current and next most current). Calculate percentages to one decimal place. (e.g. 26.4%). Dollar amounts may be shown, but are not required. Ignore all subtotals and lines with zero data. Write in any non-zero lines not on the form.
Current Year Prior Year FAV(UNF)
Revenue 100.0% 100.0%
Cost of Revenue
Research & Development expense
Sales, General &Admin. expense
Depreciation & Amortization exp.
Restructuring, merger expense
Other operating expenses
Interest expense
Other income (expense)
Provision for income tax expense
Net income from Discontinued Oper.
Other income (expense)
Net Income
(b) Based on your vertical analysis, state the major reasons for the change in net income
as a percentage of revenue and whether the change was favorable or unfavorable.
(2) Ratios
(a) Calculate the following ratios for the last TWO years and indicate whether the trend was favorable or unfavorable (two decimal places for times ratios (e.g. 1.42X) and for percentage ratios (e.g.12.85%).
. FAVORABLE Current Year Prior Year (UNFAVORABLE)
Liquidity/Solvency Ratios
1-Current Ratio (X)
(Current Assets / Current Liabilities)
2- Acid-test Ratio (X)
(Total Cash investments +
Receivables / Current
Liabilities)
3-Accounts Receivables Turnover(X)
(Revenues/ Average
Receivables)
4-Inventory Turnover(X)
(Cost of Revenue /
Average Inventories)
5-Debt Ratio (%)
(Total Liabilities / Total Assets)
End of End of Incr. (Decr.) Balance Sheet Current Year Prior Year $ %
6- Total Cash
7- Total Current Liabilities
Overall Conclusion on Liquidity/Solvency based on above Ratios and Balance Sheet data
FAVORABLE Current Year Prior Year (UNFAVORABLE)
Profitability Ratios
1- Gross Margin (%)
(Gross Profit / Revenue)
2- Profit Margin (%)
(Net Income / Revenue)
3- Return on Common
Stockholders’ Equity (%)
(Net Income / Average Total
Stockholders’ Equity)
4- Return on Total Assets (%)
(Net income / Average Total Assets)
5- Basic Earnings per share ($)
(given on Income Statement)
Incr (Decr)
Income Statement Current Year Prior Year $ %
5- Revenue
6- Net Income
Overall Conclusion on Profitability based on above Ratios & Income Statement data.
(3) Cash Flow
From the Statement of Cash Flow (FOR CURRENT YEAR ONLY):
Net Cash From (Used by) Operating Activities _______________
Net Cash From (Used by) Investing Activities _______________
Net Cash From (Used by) Financing Activities _______________
Effect of exchange rates _______________
Net Change in Cash _______________
Identify the Major Cash From (Used by) Investing Activities (2-3 items):
(NOTE: Click on arrows to view details)
(NOTE: EXCLUDE Sales and Purchases of Investments)
Item Amount
Identify the Major Cash From (Used by) Financing Activities (2-3 items):
(NOTE: Click on arrows to view details)
Item Amount
How would you characterize the “quality” of the Company’s cash flow for the CURRENT YEAR? Why?
(4) Miscellaneous Data:
Over Last Five Years
Total Common Stock repurchases ($Millions) ______________
Current Year
Income Tax Rate (%)
(Provision for income taxes / Income before taxes) ______________
Executive Compensation (Click on Insiders) ($) Current Year
Name Compensation
CEO___________________________________ ______________________
CFO___________________________________ ______________________
(5) Bonds (Click on Bonds Tab)
Morningstar Credit Rating ____________
Amount of Bonds Outstanding ____________
Capital Structure:
Most Recent:
Debt % ____________
Equity % ____________
Is Most Recent Capital Structure more or less
risky than Historical Average for this company? Why?
# of Individual Bond Issues listed (approx.) ____________
Range of Maturity Dates (from “year x” to “year y”) ____________
Range of Coupon (Contract) Rates (from x% to y%) ____________
Largest Single Bond Issue Amount ____________
Are most bonds trading at discount, premium or mixed? ____________
Are most bonds callable? _________
Debt/Equity ratio: (X)
Firm (Company) ratio _________
Industry ratio _________
Is Company favorable or unfavorable to industry? _________
Debt/Assets (X)
Firm (Company) ratio _________
Industry ratio _________
Is Company favorable or unfavorable to industry? _________
(6) Stock Analysis:
Click on Quote tab-Overview Page:
Stock Symbol (1-4 letter abbreviation) __________
Stock Exchange (XNYS=New York or XNAS=NASDAQ) __________
Shares Outstanding __________
Market Capitalization (Market Value of Company) __________
Latest Price of Stock __________
52 Week High __________
52 Week Low __________
Based on the 52 week data, is the current price of the stock (circle one)
Inexpensive (closer to the 52 week low)
Expensive (closer to the 52 week high)
Neither (approximately halfway between 52 week high and low)
Morningstar Rating (1 to 5 stars) __________
Wall Street Recommendation (1=Sell to 5=Buy) __________
Dividends:
Latest Dividends Amount (quarterly, per share) __________
Dividend Yield (%) __________
If the current Dividend Yield for the overall stock market is 2.0%, is your company a high dividend or low dividend stock compared to the overall stock market?
PE Ratio (Price/ Earnings TTM) __________
If the current PE ratio for the overall stock market is 25X, is your company a “growth” stock or a “value” stock compared to the overall stock market?
In Stock Price Chart Section:
Click on 1Y(1 Year) Stock Market Price per Share Increase (Decrease)
Current April 2016 $ %
_______ _______ _____ _____
If the average stock on the stock market is up 15% since April 2016, how would you describe your company’s stock price performance over the last year compared to the average stock?
Click on Quote tab-Company Profile:
Business Description:________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
__________________________________________________________________________________
Company headquarters (State) ____________ Number of employees ____________ Auditor ____________
Industry ____________
Fiscal Year Ends ____________
(7) Summary Conclusion:
Based on all of your attached analysis, summarize (bullet-point) the most important recent financial trends/developments of the Company and your overall conclusion.
