Corporate Finance Public Trading
Select a publicly traded U.S. corporation for which you have a common interest.
Prepare an overview of the company, incorporating the following points:
- History of the company
- History of the industry
- Types of products or services offered
- Rank in the particular industry that it operates
- Discussion of the competition
New potential products of the company on the horizon and your assessment of its impact on the company and industry
Discuss the types of financing that your company uses (short term borrowings, lines of credit, commercial paper, debentures, collateralized bonds, issues of common stock)
As per our discussion of financial ratios in chapter 3 of our textbook, prepare an analysis of as many of the 13 key ratios as you can obtain information for. Financial statements for publicly traded companies include 3 years of balance sheets and statements of shareholder equity and two years of income statements. The Internet will furnish the third year’s income statement. Prepare the financial ratios for the 3 year period using the balance sheets, income statements and statements of shareholders’ equity.
For two of the company’s closest competitors, prepare an analysis of as many of the 13 key ratios as you can for the latest year information is available. Then chart the results of the key ratios of the 3 companies for the latest common year that you can obtain information on, and provide a discussion of your interpretation of the results and which company seems to be in the best and worst financial shape.
Finally, for the three companies in (D) above, prepare an analysis of the P/E (price to earnings) ratio for a three period and contrast those numbers with the financial results of each of the companies.. Determine if there is any correlation of the P/E ratios with the financial performance and strength (or weakness) of each of the companies.