Comprehensive Financial Analysis Project

Target Corporation

vUse the Target Corporation's Form 10-K to complete the case.You will be working with Target's two most recent fiscal year Annual Reports. You can pull the two most recent Annual Reports from this link: https://investors.target.com/annual-reports

vTarget's Form 10-K is available on the company's website or through the SEC's EDGAR database here: https://www.sec.gov/edgar/searchedgar/companysearch.html

vHow to use EDGAR: https://www.sec.gov/oiea/Article/edgarguide.html

vAccess Project Excel template from Canvas

vAccess Project Written Analysis template from Canvas

vAccess latest industry information from the IBISWorld Industry Market Research Database within the college library.

oVisit my.baker.edu

oSelect "Department Resources"

oSelect Academic Resource Center

oClick on the "Library" icon

oClick on the "Articles & Databases" icon

oScroll down to the business databases and select IBISWorld Industry Market Research

oEnter Library number (if asked)

oIn the search box type Target's NAICS Code: 45211

oSelect "45211 - Department Stores in the US Industry Report"

oScroll down and select under "Major Players" Target Corporation

oUse the information here for industry performance for competitors of Target for analysis

Part I. Financial Analysis in Excel (90 points)

Section 1. Financial Statement Analysis (35 points)

Please be sure to show all support for your work.You will be using the following sections of the annual report:MD&A, consolidated financial statements and notes to the financial statements.

Complete the following tabs in the Excel template:

A.Vertical Analysis - Income Statements

B.Vertical Analysis - Balance Sheets

C.Horizontal Analysis - Income Statements

D.Horizontal Analysis - Balance Sheets

Section 2. Ratio Analysis (35 points)

Identify the appropriate formula and calculate the following ratios for the most recent two fiscal years (Market performance ratios (earnings per share, book value per share, price-earnings ratio, and dividend yield are already computed and included in the template.)

NOTE: You will need to use the previous year's reports in order to calculate averages where applicable.

Complete the following ratios in the Excel template:

Measures of liquidity

oWorking capital

oCurrent ratio

oQuick ratio

oInventory turnover

oAverage days to sell inventory

Measures of solvency

oDebt to assets

oDebt to equity

oNumber of times interest earned

oPlant assets to long-term liabilities

Measures of profitability

oNet margin (return on sales)

oAsset turnover

oReturn on investment

oReturn on equity

Section 3. Budgeting (20 points)

In this section visit https://investors.target.com/annual-reports to access the previous three years annual reports NOT including the two fiscal years you have analyzed to calculate the following in the template.

1.Calculate the percentage change for each of the following categories of revenues and expenses the recent two fiscal years.

2.Calculate the average percentage change

3.Use the most recent two years data and the average percentage change calculated in Section 1 to a budget for last year.

Part II. Written Analysis (90 Points)

Complete the following components in your written analysis template

Section 1. Accounting Treatment (18 points)

For this section, analyze and explain in detail the accounting treatment of the following areas for Target using the most recent annual report and disclosures.

Fixed Assets

Intangible Assets

Liabilities (long term and short)

Section 2. Trend Analysis (18 points)

Using the vertical analysis of the income statements, identify the significant trends

Using the vertical analysis of the balance sheets, identify the significant trends

Using the horizontal analysis of the income statements, identify the significant trends

Using the horizontal analysis of the balance sheets, identify the significant trends

Section 3. Ratio Trend Analysis (18 points)

Using the ratio analysis, identify the trends in ratios between the last two years as well as compare to the industry information accessed from the IBIS database.

Also analyze ratios and figures based on the disclosures in the annual report as evidence to the noticeable trends

Section 4. Budgeting Analysis (18 points)

Compare actual amounts from last year to the budget you have created for sales. Give an analysis on if Target exceeded budgeted sales. If so, explain the contributing factors for this. If sales did not exceed what was budgeted, explain the contributing factors.

Compare actual amounts from last year to the budget you have created for expenses. Give an analysis on if Target exceeded budgeted expenses. If so, explain the contributing factors for this. If expenses did not exceed what was budgeted, explain the contributing factors.

Conclusion

Reference List

Mechanics (18 points)

All components should be prepared in entirety

Be sure to check your analysis for all spelling, grammar and punctuation issues prior to submission.

Analysis should be in a professional tone

Reference List and in-text citations should be in APA format