Finance case study

       Word document ofabout 10 pages (including cover page and appendix), Times New Roman font size12 for the main body

       Sample firmsfinancial statements should be attached as an appendix to the report

       Tables or graphs forratio analysis should be inserted in appropriate sections

Instructions:

1.      Preparation: Read Chapters 2 and 3and the corresponding PPTs for Chapters 2 and 3 and the corresponding sectionsin the textbook.

2.      Pick the firms: Select a common theme(industry) for your project and choose three companies in that industry.Describe briefly the industry and company profiles, and analyze the firmscompetitive positions in that industry.

3.      Collect data: Download thefinancial statements (balance sheet and income statement) of those companiesfor the last three years from the same source to ensure data consistency (e.g.Zacks Investment Research). Describe the data briefly in your report.

4.      Perform ratio analysis: Calculate the variousfinancial ratios discussed in Chapter 3, including liquidity ratios, assetmanagement ratios, debt management ratios, profitability ratios, and marketvalue ratios; also use the DuPont equation to calculate ROEs. Present theresults in an organized way in your report. (All ratios in Table 3-1 on p.119should be included in your report; other ratios mentioned in the textbook areoptional.)

5.      Analyze the results: Conduct trendanalysis (time-series) and comparative analysis (cross-section) for the variousratios to interpret the results and identify potential problems for samplefirms. (Common size analysis and percentage change analysis are not required.)

6.      Recommend changes: Propose possiblechanges to address the identified problems to achieve competitive advantages.