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Financial Analysis of a Firm Using Ratios

to start this assignment, please select two public companies that are similar in nature… Say Coke/Pepsi or Ford/General Motors or McDonald’s/Burger King. Then, go to a financial web site such as Yahoo Finance or MSN Money and find their most recent financial statements; be sure to use financial statements from the same period (for example, FY 2019, or Quarter 1 2020) so that you can compare the same periods for each company. Refer to the required ratio list in the assignment and calculate all of these (sites like https://cpaclass.com/fsa/ratio-01a.htm, https://www.readyratios.com/reference/analysis/most_important_financial_ratios.html, and https://corporatefinanceinstitute.com/resources/knowledge/finance/financial-ratios/ may help with this). Finally, analyze each company in terms of these ratios and submit a report of your findings in PowerPoint format.

To complete this project, you must complete the following four steps:

Identify a company and one of its primary competitors to perform the financial analysis on
Complete a full ratio calculation for both firms
Assess, interpret, and compare the financial ratios calculated for both firms
Create PowerPoint slide show of your presentation

Overview of the firm
In this section, you will conduct research to provide a summary of the following:

Overview of the selected firms product & industry
Overview of current financial health of the selected firm
Overview of industry & any current trends potentially impacting the selected firm
Identified competitor and brief summary of that competitors products

Ratio Calculation
In this section, you must gather the most recent set of  financial statements on their selected firm and competitor firm and calculate the following ratios for each firm (Note: All calculations must be shown for credit):

Profitability ratios: operating margin, profit margin, return on total assets, basic earning power, return on common equity
Asset management ratios: inventory turnover ratio, days sales outstanding, fixed asset turnover ratio, total asset turnover ratio
Liquidity ratios: current ratio, quick ratio
Debt management ratios: total debt to total assets, times interest earned ratio
Market value ratios: price to earnings ratio, market to book ratio

Financial Assessment
In this section, you must assess, interpret, and compare the financial ratios calculated for both firms in step 2. you will perform a side-by-side analysis and address the following questions:

Which firm has better profitability ratios? Why?
Which firm has better asset management ratios? Why?
Which firm has better liquidity ratios? Why?
Which firm has better debt management ratios? Why?
Which firm has better market value ratios? Why?
Based upon the ratio comparison, which is a better investment choice- the originally selected firm or its competitor? Why?

Presentation Guidelines
All calculations must be shown for credit- calculations can either be embedded in the presentation or submitted as a separate Excel file
Presentations must be in Power Point
Presentations should be 15 slides max
APA format must be used for all references
analyze each company in terms of these ratios and submit a report of your findings in PowerPoint format.

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