Financial Statements Analysis

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This assignment includes a report (pdf format) based on listed companies. The companies & industries among the ones you can choose are listed below.

You will have to compute Key Performance Indicators (KPI) and other ratios to grasp financial performance, liquidity, profitability, or leverage by industries.

The aim of this exercise is that the students not only compute but interpret and analyze the firm’s situation in their industry’s context.

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The public listed firms are available here (S&P500). The industries available for this exercise are: The professor will assign the industry in a raffle.

· Insurances · Consumer Electronics Manufacturing · Furniture & other home elements retail · Natural Resources (Commodities) Production · Software Development · Supply Chain & Logistics · Semiconductor Manufacturing · Education Services · e-Market retail · Food Processing Industries

Exercise:

Compute for any industry chosen from the above list the following ratios and explain in your own words how that ratio compares among at least 3 corporations

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competing in the chosen industry: Liquidity:

  • Acid Test
  • Cash Ratio
  • Current ratio
  • Inventory turnover
  • Receivable’s turnover
  • Payable’s turnover
  • The operating cycle
  • Cash conversion cycle
    Cash Flow:
  • CF coverage ratio
  • Free CF / CF from Ops ratio
  • CF from Ops / Sales Ratio
  • Price / CF ratio

(each computed, explained and analyzed item will get you 4.5 marks approx.)

Leverage:

  • Debt Ratio
  • Times Interest Earned Profitability:
    • Gross margin
    • Net margin
    • EPS
    • RoA
    • RoE Market:
    • P/E ratio
    • Market to Book
    • Market Cap
      Formalities:
    • Wordcount: 1000 words approx.
    • Cover, Table of Contents, References and Appendix are excluded of the total wordcount.
    • Font: Arial 12,5 pts.
    • Text alignment: Justified.
    • The in-text References and the Bibliography must be in Harvard’s citation style.sw