Reference no: EM132211169
Question: You have been asked to analyze two companies whether or not the companies are in the same industry. By performing the tasks listed below, select the company which you believe has had the strongest historical performance.
1. Download the annual income statements, balance sheets, and cash flow statements for the last three fiscal years. Enter each company's stock symbol and then go to financials.
2. Find historical stock prices for each firm from Yahoo! Finance or another source. Use the closing stock prices (not the adjusted close).
3. For each of the three years of statements, compute or show the following information for each firm: Valuation Ratios: Price-Earnings Ratio (for EPS use Diluted EPS Total), Market Cap (for current period only), EPS, Closing stock price
Profitability Ratios: Gross profit on net sales, Operating income on net sales, Return on shareholder's equity, Return on average assets, Net Income,Comprehensive income Financial Strength Ratios: Current Ratio,Acid-test Ratio, Debt to equity ratio, Accounts receivable turnover, Inventory turnover, Equity multiplier
Requirements: Part Ia: Based on your calculations of the above requirements, prepare a report to management (Senior Vice President â€" Equity Investments) in which you identify the corporation which has had the strongest historical performance. Make any assumptions to support your decision. Also, use any outside information to support your decision. You may also be creative and develop one or many alternative ratios to value the companies to support your decision.
Part Ib: Based on current events related to the corporation(s), the industry and the overall national or international economy, state whether you believe the current level of performance will (a) continue, (b) improve or (c) worsen. Also, if you cannot come to conclusion, state why. Make any assumptions to support your decision. Also, use any outside information to support your decision. You may also be creative and develop one or many alternative ratios to value the companies to support your decision. you may create your own template. You may wish to perform a horizontal analysis to assess the movement of the ratios. Please use excel or word so I can see a summary of your calculations The 2 companies you can use are Under armour and Nike. You can find the statements on www.nasdaq.com, yahoo or where ever else will work best.