Vtech Holdings Limited financial analysis report discussion Please see attached paper for detail of assignment. 7-8 page financial analysis report must be
Vtech Holdings Limited financial analysis report discussion Please see attached paper for detail of assignment.
7-8 page financial analysis report must be written properly. They must include a title page, a
table of contents, exhibits, and a reference page, which do not count toward the 7-8 page
minimum. For the final report, information sources from the web, etc. must be cited properly,
using APA style. This means that every table that you cut and pasted or typed from the web must
have a source at the bottom of the table AND that citing must also be included in a reference page
at the end of the report.
The parts of the research paper are discussed below.
The completed report (parts 1 through 8) is
due Week 7.
Your project should include:
1. An overview of the corporation.
o
Provide general information regarding the type of business, products and/or services, location
of headquarters, name of CEO, number of employees, and countries of operation, etc.
2. The latest financial statements
o
Get the income statement, balance sheet, and cash flow statement for the past fiscal year. Cut
and paste them in your report as exhibits. Do not forget to cite the source under each
statement.
o
If you cannot cut and paste them, you may have to type in the information in a table in your
report.
3. A summary of each financial statement
o
Take each statement and state the key parts in words. Tell a story from each of the financial
statements. For example, for the income statement, the story starts like, “Total Revenues in
2010 were $10 billion, while Cost of Goods Sold were $8 billion, leaving a gross profit margin
of $2 billion, or 20 percent of total revenues….After taking out interest and taxes from EBIT,
the net income was $0.5 billion, or 5 percent of total revenues.”
4. Ratio calculation (include 3 major types of ratios).
o
Organization of this section is based on the THREE types of ratios listed in the text
book. Calculate the ratios from the financial statements in part c above using Excel or your
calculator and present them in a table for the most recent 2 years, with industry benchmarks
for each year.
o
If applicable and/or helpful to your analysis, find industry financial ratios online (e.g.
Yahoo.com) and compare your corporation’s ratios to these industry ratios.
5. For you to decide if a corporation’s stock is a good buy or sell, you must forecast several key
variables, including the stock price.
o
Use historical prices (3 years of monthly data recommended) and forecast the stock price for
the next year. Use a moving average, etc. to create your forecast.
o
Create a graph from the historical data and show your forecast on the same graph. You can add
a trend line to the graph to help you with a forecast. Include the graph in your report.
o
You need to say specifically what the forecasted value of the stock price is.
6. Recommendation regarding the future of these corporations.
o
Is the stock a good buy, average buy, or a poor buy (implying a good sell)?
o
Include a justification of your recommendation based on your analysis and research. The steps in preparation of financial analysis report include the following:
1. Select a publicly held company.
2. This company should be easily classifiable into an industry, so you can compare it to industry
averages. In other words, no conglomerates, or companies that are involved in multiple industries.
3. Obtain the firm’s balance sheet, income statement, and statement of cash flows for the past 3 years.
Download or read the firm’s annual report.
4. Go to: http://www.sec.gov/edgar/searchedgar/webusers.htm. Research EDGAR’s database for
additional SEC report filings: 8-k, 10-Q.
o The following table is the type of Excel or Word table that should be used to gather and report
your ratio and financial performance data. You should pick 3 of the 5 financial diagnostic
categories, and use those 3 in your analysis.
Financial Diagnostic
Categories
Chosen Company vs.
•
1. Liquidity of Short-Term
Assets
•
•
•
2. Long-Term Debt-paying
Ability
•
•
•
3. Profitability
•
•
•
4. Asset Utilization /
Management Efficiency
•
•
•
5. Market Measures
•
•
Benchmark Competitor
Current Ratio
Cash Ratio
Quick Ratio
•
Debt Ratio
Debt-equity Ratio
Times Interest Earned
•
•
•
•
•
Net Income / Sales (Profit
•
Margin)
Net Income / Assets (ROA)
•
Net Income / Shareholder Equity •
(ROE)
Total Asset Turnover
Inventory Turnover Measures
Accounts Receivable Turnover
•
Price / Earnings Ratio
Earnings per Common Share
Dividend Payout
•
•
•
•
•
Current Ratio
Cash Ratio
Quick Ratio
Debt Ratio
Debt-equity Ratio
Times Interest Earned
Net Income / Sales (Profit
Margin)
Net Income / Assets (ROA)
Net Income / Shareholder Equity
(ROE)
Total Asset Turnover
Inventory Turnover Measures
Accounts Receivable Turnover
Price / Earnings Ratio
Earnings per Common Share
Dividend Payout
Use 3 ratios per diagnostic category. Place your ratio calculations in the table for your selected
companies—primary company and industry benchmarks. Using 3 diagnostic categories, and 3 ratios
to assess each category, results in 9 ratio measures per company that will be compared side by side.
5. To validate your research, 3 years of data should be analyzed.
6. The 7-8 page financial analysis report must be written properly. They must include a title page, a
table of contents, exhibits, and a reference page, which do not count toward the 7-8 page
minimum. For the final report, information sources from the web, etc. must be cited properly,
using APA style. This means that every table that you cut and pasted or typed from the web must
have a source at the bottom of the table AND that citing must also be included in a reference page
at the end of the report.
The parts of the research paper are discussed below. The completed report (parts 1 through 8) is
due Week 7. Your project should include:
1. An overview of the corporation.
o Provide general information regarding the type of business, products and/or services, location
of headquarters, name of CEO, number of employees, and countries of operation, etc.
2. The latest financial statements
o Get the income statement, balance sheet, and cash flow statement for the past fiscal year. Cut
and paste them in your report as exhibits. Do not forget to cite the source under each
statement.
o If you cannot cut and paste them, you may have to type in the information in a table in your
report.
3. A summary of each financial statement
o Take each statement and state the key parts in words. Tell a story from each of the financial
statements. For example, for the income statement, the story starts like, “Total Revenues in
2010 were $10 billion, while Cost of Goods Sold were $8 billion, leaving a gross profit margin
of $2 billion, or 20 percent of total revenues….After taking out interest and taxes from EBIT,
the net income was $0.5 billion, or 5 percent of total revenues.”
4. Ratio calculation (include 3 major types of ratios).
o Organization of this section is based on the THREE types of ratios listed in the text
book. Calculate the ratios from the financial statements in part c above using Excel or your
calculator and present them in a table for the most recent 2 years, with industry benchmarks
for each year.
o If applicable and/or helpful to your analysis, find industry financial ratios online (e.g.
Yahoo.com) and compare your corporation’s ratios to these industry ratios.
5. For you to decide if a corporation’s stock is a good buy or sell, you must forecast several key
variables, including the stock price.
o Use historical prices (3 years of monthly data recommended) and forecast the stock price for
the next year. Use a moving average, etc. to create your forecast.
o Create a graph from the historical data and show your forecast on the same graph. You can add
a trend line to the graph to help you with a forecast. Include the graph in your report.
o You need to say specifically what the forecasted value of the stock price is.
6. Recommendation regarding the future of these corporations.
o Is the stock a good buy, average buy, or a poor buy (implying a good sell)?
o Include a justification of your recommendation based on your analysis and research.
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