Financial analysis
Obtain the most recent annual report for the two companies that your group has chosen. The reports should contain at least three years of income statement data and two years of balance sheet data.
Analyze at least 3 (three) items on the income statement for each company that would be important to an investor and or user of the financial information, and discuss whether each companys performance related to these items appeared to be improving, deteriorating, or remaining stable over the two years. Justify your answer.
Analyze at least 3 (three) items on the balance sheet for each company that would be important to an investor and or user of the financial information, and discuss whether each companys performance related to these items appeared to be improving, deteriorating, or remaining stable over the two years. Justify your answer.
Analyze each companys investing and financing activities for the most recent year as identified in the statement of cash flows, specifically identifying the two largest investing activities and the two largest financing activities. Discuss whether you agree or disagree with the investing and financing strategies that each company appears to be employing.
Identify 2 (two) items not included in (or derived from) the financial statements that you think would be important to someone considering whether to invest in each company. Discuss your reasons for believing that these two items about the company would be important in making an investment decision. (Hint: you might want to consider items discussed in other business classes.)
Compare the results you obtained above for both companies. Based on the analysis done by your group on the financial statements, if you were making a decision to invest in one of the two companies, which company would you choose? Why? (Note: your answer in this section must include some financial issues, but your answer need not be limited to a discussion of financial issues.)