1st Company = Revlon

2nd Company = Estee Lauder

Find and use annual reports for both companies along with any other sources you believe would be reputable and relevant to this project. After completing your analysis of both companies, recommend which 1 of these 2 companies is the stronger company going forward and therefore the one an investor should invest in and provide your rationale for this recommendation. It should be based on your analysis of the companys financial statements and other sources (assume the investor only wants to invest in 1 of the 2 companies being analyzed) so you need to determine and explain which of the 2 companies would be the superior investment. Refer to and use all of the following from both companies annual reports and/or 10-K filings to include:

• Each companys financial statements (Income statement, Balance sheet, Cash flow, Stockholders Equity).
• The identified risks addressed in the annual reports.
• The Management Discussion & Analysis (MD&A) section.
• The notes to the financial statements addressed in the annual reports.
• Balance sheet with particular focus on Goodwill/Intangible Assets.
• External auditors assessment re. the quality of the companys financial accounting/reporting.
• Any other sections of the annual report that you believe are relevant to your analysis.

You must extract all financial information regarding the companies you analyze from their annual reports and calculate the relevant ratios independently. Some key elements (but not an all-inclusive list) to this analysis follow:

1. For both companies, compare, contrast, and evaluate the following over a minimum of at least the past 5 years:
   1. ROI performance
   2. Liquidity
   3. Critical working capital/PP&E turnover efficiency
   4. Overall Balance sheet efficiency
   5. Market perception/valuation of the companies
   6. Dividend payout comparison
   7. Debt ratios
   8. Cash flow performance (Operating, Investing, Financing, & Free Cash Flow)
   9. Cash Conversion Cycle
   10. Profitability performance/efficiency
   11. Goodwill
   12. Common size and/or horizontal analysis for each company addressing key elements within the companys:
       1. Income statement
   2. Balance sheet

Provide a separate schedule showing the basis for each of these calculations.