Whether to invest BUY or SELL shares of stock in this company

Whether to invest BUY or SELL shares of stock in this company

For this project,you will analyze the financial statement information of a company of interest to them.

Please develop an argument whether you would recommend an investor BUY or SELL shares of stock in this company. Please think about including any negative opinions and then countering them in your paper. Additionally, you should comment on any action you would recommend the company to take to improve your evaluation of their position. For example, if you are recommending a SELL, what should management do to make them a BUY? If you are recommending a BUY, where are they potentially vulnerable and how can they protect their good standing?

Written analysis should be at least ten written pages plus any calculations or supporting documents as appendices.

You may want to look at the company’s website to insure that its annual reports and SEC filings (principally Form 10 k) are available and accessible. Feel free to read investor’s opinions but be sure to create your own.

Possible Topics to Include in Paper
I. Summary description of business
II. Financial Summary (Tabular for most recent three years)
1) Sales/Revenues
2) Operating Profit
3) Net Income
4) Earnings per Share
5) Capital Expenditures
6) Free Cash Flow
7) Total Assets
8) Total Equity
9) Common Dividends per Share
III. Ratio Analysis (Time Series. Tabular format for most recent years.)
1) Margins – gross, operating, net
2) Liquidity – working capital, current ratio, quick ratio
3) Activity – A/R turnover, inventory turnover
4) Operating Leverage – %? net income/ %? sales
5) Financial Leverage (Assets/Equity & Debt/Capital) & Interest Coverage
6) Dupont System (ROA [Net Margin & Asset Turnover], Leverage & ROE)
7) Period growth rates of sales/revenues, operating profit and EPS
8) Payout Ratio
IV. Valuation Tabular format. (Most recent fiscal year)
1) P/E ratio
2) Market/Book
3) Beta *
4) Dividend yield
5) Dividend growth rate (last three years)
* Ok to use published value
V. Analysis
1) Evaluate financial results in terms of revenue and earnings growth, returns, leverage and new investment.
2) Comment on capital structure.
3) Summarize the key strategic initiatives that must be successfully implemented.
4) Summarize external market influences that may affect the value of the company positively or negatively.
5) What is your view of the company’s financial condition? Will it impact your success?
6) What is your view of the company’s future? (Defend your judgments)