This Portfolio Project has two parts: calculations (excel) and a 4- to 6-page essay. While the calculation requirements of this assignment are important, equally important are your discussion and analysis of the quantitative results. You will submit two documents: 1) a spreadsheet containing your horizontal and vertical analysis (and perhaps your ratios) and 2) a word document containing your essay.
Choose a publicly traded company and perform an expanded analysis on the financial statements. Please use the most current 10K statements available on www.sec.gov http://www.sec.gov or annual statements in finance.yahoo.com http://finance.yahoo.com. You will submit both parts separately.
Part 1: Put answer in Excel spreadsheet:
- Horizontal and vertical analysis of the Income Statements for the past three years (all yearly balances set as a percentage of total revenues for that year).
- Horizontal and vertical analysis of the Balance Sheets for the past three years (all yearly balances set as a percentage of total assets for that year).
- Ratio analysis (eight ratios of your choosing) for the past three years PLUS a measurement for the creditworthiness of your firm as measured by Altman’s Z-score. Note that if you used your chosen firm for our ratio-related discussion posts, then you MUST also present industry-average ratios or current year competitor ratios for your ratio analysis. Comparing your firm’s ratios to a close competitor or an industry-average ratio makes your analysis much more meaningful.
Part 2: The Paper:
- 4-6 pages in length.
- Include a proper introduction and conclusion.
- Include a reference page.
- Your paper should provide your reader with an overall understanding of the financial health of your chosen firm including the following:
- Discussion of the ratio analysis results, including rationale for the ratios chosen.
- Discussion of all horizontal and vertical analysis from above.
- Discussion of four items from the management discussion of the firmthat support the conclusion formed in your discussion of the financial results.