The purpose of this project is to help you develop skills not only in
performing the calculations behind financial analysis but interpreting
the numbers as well.
You are to pick a company. You should pick one either from the
industry in which you are currently working or an industry in which you
are interested. You could also pick a division of a company. It is
imperative to use that sufficient data about your company and that it is
available. One way to do this is to pick a publicly held company. If
you pick a privately held company or a division of a company, make sure
that the data necessary to do a significant financial analysis is
If you use data that is not publicly available, be sure to talk to
your manager and to make absolutely sure that revealing that data is not
You will also need to find a standard against which to compare your
findings. This could be a different company in the same industry. This
could also be the same company at a different time. Additionally,
average or benchmark numbers are available for several industries. If
you decide to use a different company in the same industry or the same
company at a different time, make sure that there are enough differences
between the two to make an analysis meaningful.
After you have selected a company, put yourself in the place of an
analyst who has been asked to perform an analysis of the company and
provide a recommendation to management.
Use ratio analysis, common size analysis, or other techniques to
determine areas in which the company is doing well as well as areas that
management should look at. Then, present your analysis and
recommendations in the form of a paper.
The completed paper should be about 1,000 words long. In the paper,
you do not have to explain the ratios in depth. You may assume that the
reader has a basic understanding of finance and knows what ratio
analysis is, although he or she might not be able to list all the ratios
and how to calculate them from memory. The reader is not going to want a
lot of background about financial analysis. He or she really wants
information that he or she can apply to the given situation, which is
the company that you have selected.
If you like, you can write the paper in the form of a memo to
management. You do not have to cite your source for how to calculate the
ratios. You do need to provide a reference to where you got that data
not only for your subject company but for the other company or standard
to which you compared your company.
· The spirit of this assignment is for you to calculate and interpret
the results. The purpose is not for you to find calculations and
interpretations that have been done by someone else.
· The paper is expected to conform to the standards for graduate school writing.
· The purpose of your analysis is internal evaluation. Refrain from using stock market valuation ratios.
When you have completed the project, place it in one Word document and place that document in the appropriate dropbox.