· the other website is

· Many useful links are in the document “Financial Data Sources on the Internet” I assigned to you at the beginning of the semester.

· U.S. Treasuries:

· Good sources for betas:

· Value Line:

· Standard&Poor’s Netadvantage:

Instructions:

About the Company

Provide one short paragraph to introduce the company:

· a description of its products, customer base, major suppliers;

· major events (merger and acquisition, divestitures, change of directors, credit rating changes, new product releases, etc) during the past three years;

· a description of its strategy during the past three years.

Section 1: Financial Statement Analysis

Calculations: Measure your company’s financial ratios of the past three years from the 6 categories below. Then, compare each ratio with its competitor (do the same calculations for the competitor).

(1) Liquidity:

· Current Ratio

· Quick Ratio

(2) Efficiency:

· Total Asset Turnover

· Days Sales Outstanding

(3) Leverage:

· Total Liabilities to Total Assets

· Times Interest Earned (TIE) Ratio

(4) Profitability:

· Profit Margins- Percentage of revenues remaining after deductions:

· Return on Assets (ROA)

(5) Market multiples:

· Price Earnings (P/E) ratio

· Earnings Per Share (EPS)

(6) DuPont Ratio and explain. Please illustrate on each individual part of the DuPont Ratio (profit margin, turnover, and leverage).

Analysis Report:

Based on your calculations, take a thorough analysis of the company’s financial healthiness from the above 6 perspectives. Please write one paragraph for each perspective.

Section 2: Stock Valuation & WACC

Calculations:

· Calculate the company’s intrinsic stock valuation by DDM. If no dividend issued, please use the price multiple approach.

· Calculate the company’s weighted average cost of capital (WACC).

Analysis Report:

· First, based on your calculations, take a thorough analysis of the company’s

Valuation and WACC, one paragraph for each. Specifically, is the company’s stock price currently undervalued or overvalued? Is the company’s WACC high or low in the industry?

· Then, make a recommendation – would would you buy or sell the company’s stock? Especially, what do you expect the impact of Covid-19 on the company’s stock. (Hint: please make decisions based on intended investment holding period. For example, you may recommend a “buy” if you believe the currently underperforming stock will rebound post Covid-19)

Term Project Grading Criteria

Percentage	Criteria/Expectations
0%	Not turned in, OR late submission, OR not original work
50% – 69%	Incomplete AND Poor Quality (*Incomplete means the student hasn’t accomplished all required sections of term project by due date; Poor Quality means the demonstration of misunderstanding on concepts, wrong calculation OR no calculation process at all, OR incorrect interpretation of calculation results)
70% – 79%	Fair (*Fair means the student has accomplished all required sections of term project by due date; however there is major mistake in applying the concepts in the financial model OR major mistakes in the explanation of concepts OR major mistakes in calculations)
80% – 89%	Good (*Good means the student has accomplished all required sections of term project by due date; also there is only minor mistake in explanation of concepts OR minor mistakes in calculations)
90% – 100%	Excellent (* Excellent means the student has accomplished all required sections of term project by due date; also there is no mistake in explanation of concepts AND no mistakes in calculations)