Your analysis, will address each of the following: 1. Business Strategy Analysis: Develop an understanding of the business and competitive strategies of the company. Which of the three generic competitive strategies does it utilize (low cost provider, differentiation, or focus)? This should be covered in not more than three paragraphs. Do not spend time writing a history of the company. This is an analysis, not a history lesson.
2. Accounting Analysis: Do the accounting practices adopted by the company generally reflect an accurate picture of the economic performance of the company? Did your research find any public announcements of restatement of earnings or other financial statements that would indicate that the financial statements may be of dubious value? This can be done by reviewing the company’s 8K filings with the SEC (a mandatory requirement for this paper). These filings can generally be found on the company’s website under Investor Relations – SEC filings.
3. Financial Analysis: Analyze financial ratios and cash flow measures of the company relative to its historical performance. For purposes of this research paper a 2 year look back is sufficient and required. You must use at least 10 of the ratios noted on page 103 of the text including all four of the profitability ratios.
4. Prospective Analysis: Develop forecasted performance measures and list the assumptions associated with your forecast. List your assumptions and reasons for your forecast. You may also cite the works of other analysts who have published forecasted earnings for the time frame you are addressing. (Hint: take a look at Yahoo/finance – analysts opinion
5. Conclusion: Will you or will you not invest $25 million in this particular Company? Support your conclusion? Remember a negative conclusion is just as valid and valuable as a positive conclusion.
Avoid general Internet key word searches. Wikipedia and other unauthorized sources are inappropriate for graduate work. Articles noting up to date information is such sources as The Wall Street Journal, Barron’s or Business Week may be useful in addressing the appropriateness of current strategies, resource pricing, etc. given market conditions or the status of competitors.
Writing the Paper: The following are general guidelines for format and organization. 1. Format: a. Minimum of ten pages (including self prepared exhibits), with numbered pages. b. Typed, double spaced. c. New Times Roman (i.e. business) font, 12 point. d. Margins – 1.25 inches. e. Include boldface headings and subheadings. f. Note source citations as appropriate under APA guideline. 2. Organization: b. Introduction – A brief statement of the purpose of the paper and explanation of its organization. You are welcome to use pseudonyms for the name of the company or individuals addressed in the paper. c. Analysis -Address four concepts noted in “The Paper etc” on the preceding page. d. Summary – A brief statement combining the finding arising from the analysis. e. Conclusion/Recommendations – should you invest or not invest the $25 million and why or why not.