Group Project Details/Goals
The project will require that students (assigned in groups of ~6) select, research and conduct financial analyses on firms of a similar nature; e.g. Verizon vs. AT&T; Exxon Mobil vs. Chevron, Google vs. Apple, using three common business software programs such as PowerPoint, Excel, and Word or their equivalents. Students must apply appropriate financial concepts in their analysis and communicate their findings clearly both orally and in writing. Students will have 15-20 minutes to present their research to the class (in any preferred form…video, PowerPoint) and submit a 5-page written report plus the attachment of 1 original spreadsheet of the companies being researched. Each presentation will be followed by a 5-minute class discussion.
Ultimate conclusion of the presentation will be to conclude that one of the analyzed companies is a superior common stock investment versus the other company over a one-year horizon. Conclusions must be supported.
Presentations should focus on:
Comparing and contrasting balance sheets and income statements.
Identifying firms’ relative strengths and weaknesses using tools such as (but not limited to) Dupont analysis (for ROA & ROE).
Calculating for each firm their respective Weighted Average Cost of Capital.
Relative stock performance can be as a result of a number of different drivers. Some examples are:
Strength of management/better run company
Better product pipeline
A company’s stock has been oversold (stock price beaten down to an extreme), that a bounce back will drive outperformance.
Change in government policy or customer tastes.
However, your analysis should focus almost exclusively on the concepts and tools learned during the semester in class. In the event that your preferred company choice of the two has weaker financial statement metrics than the other company, explain why you feel that is so. But again, the primary exercise here is to use the tools you have learned.
No two groups can analyze the same companies. First come/ first served. Each group can lock and time-stamp their choices via the Announcement function in Canvas.
Due Dates: We are currently tracking for the first presentations to be either December 5 or 7.
Group personnel will be distributed October 26.