Detailed explanation. Follow the steps kindly.

Step 0: Pick a company of your choice and post your choice on the Discussion Board for Picking Firms for Projects and state your firm's name that you plan to study in the subject line so that other students may not choose the same company. It will be a first come, first serve basis for choice of company. Step 1: Find information about your company from yahoo finance, cnn money, google finance etc including ratios, betas and any other type of information that may help you understand the company you are analyzing. You do not calculate anything but gather data. If you want, you can also acquire the company's financial statements for the past three years from a company's website or their recent annual report; in the company's 10K filing on the SEC's EDGARdatabase; or from other sources found at the library. As a minimum, get the following statements, for at least 3 years. - Annual Report - Balance sheets - Income statements - Shareholders equity statements - Cash flow statements Step 2: Quickly scan all of the statements to look for large movements in specific items from one year to the next. Create an excel sheet summarizing important financial information (not every asset/liability/equity item) from which you can glean patterns. For example, did revenues have a big jump, or a big fall, from one particular year to the next? Did total or fixed assets grow or fall? If you find anything that looks very suspicious, research the information you have about the company to find out why. For example, did the company purchase a new division, or sell off part of its operations, that year? Step 3: Review the notes accompanying the financial statements for additional information that may be significant to your analysis. Step 4: Examine the balance sheet. Look for large changes in the overall components of the company's assets, liabilities or equity. For example, have fixed assets grown rapidly in one or two years, due to acquisitions or new facilities? Has the proportion of debt grown rapidly, to reflect a new financing strategy? If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 5: Examine the income statement. Look for trends over time. Calculate and graph the growth of the following entries over the past several years. Revenues (sales) Net income (profit, earnings) Are the revenues and profits growing over time? Are they moving in a smooth and consistent fashion, or erratically up and down? Investors value predictability, and prefer more consistent movements to large swings. For each of the key expense components on the income statement, calculate it as a percentage of sales for each year. For example, calculate the percent of cost of goods sold over sales, general and administrative expenses over sales, and research and development over sales. Look for favorable or unfavorable trends. For example, rising G\&A expenses as a percent of sales could mean lavish spending. Also, determine whether the spending trends support the company's strategies. For example, increased emphasis on new products and innovation will probably be reflected by an increased proportion of spending on research and development. Look for non-recurring or non-operating items. These are "unusual" expenses not directly related to ongoing operations. However, some companies have such items on almost an annual basis. How do these reflect on the earnings quality? If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 6: Examine the shareholder's equity statement. Has the company issued new shares, or bought some back? Has the retained earnings account been growing or shrinking? Why? Are there signals about the company's long -term strategy here? If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 7: Examine the cash flow statement, which gives information about the cash inflows and outflows from operations, financing, and investing. While the income statement provides information about both cash and noncash items, the cash flow statement attempts to reconstruct that information to make it clear how cash is obtained and used by the business, since that is what investors and creditors really care about. If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 8: Find information about your company from yahoo finance, cnn money etc including ratios, betas and any other type of information that may help you understand the company you are analyzing. You do not need to do as much calculating as much as gathering of data. - Obtain data for the company's key competitors, and data about the industry. - Review the market data you have about the company's stock price, and the price to earnings (P/E) ratio. Try to research and understand the movements in the stock price and P/E over time. Determine in your own mind whether the stock market is reacting favorably to the company's results and its strategies for doing business in the future. - Review the evaluations of stock market analysts. These may be found at any brokerage site, or from various locations on yahoo, cnn money and other finance sites. Step 9: Review all of the data that you have generated. You will probably find that there is a mix of positive and negative results. Answer the following question: "Based on everything I know about this company and its strategies, the industry and the competitors, and the external factors that will influence the company in the future, do I think this company is worth investing in for the Iong term?" Explain why based on the data that you present. Step 10: Summarize all the information in no more than a 1-3 page written report and an appendix of tables. Step 0: Pick a company of your choice and post your choice on the Discussion Board for Picking Firms for Projects and state your firm's name that you plan to study in the subject line so that other students may not choose the same company. It will be a first come, first serve basis for choice of company. Step 1: Find information about your company from yahoo finance, cnn money, google finance etc including ratios, betas and any other type of information that may help you understand the company you are analyzing. You do not calculate anything but gather data. If you want, you can also acquire the company's financial statements for the past three years from a company's website or their recent annual report; in the company's 10K filing on the SEC's EDGARdatabase; or from other sources found at the library. As a minimum, get the following statements, for at least 3 years. - Annual Report - Balance sheets - Income statements - Shareholders equity statements - Cash flow statements Step 2: Quickly scan all of the statements to look for large movements in specific items from one year to the next. Create an excel sheet summarizing important financial information (not every asset/liability/equity item) from which you can glean patterns. For example, did revenues have a big jump, or a big fall, from one particular year to the next? Did total or fixed assets grow or fall? If you find anything that looks very suspicious, research the information you have about the company to find out why. For example, did the company purchase a new division, or sell off part of its operations, that year? Step 3: Review the notes accompanying the financial statements for additional information that may be significant to your analysis. Step 4: Examine the balance sheet. Look for large changes in the overall components of the company's assets, liabilities or equity. For example, have fixed assets grown rapidly in one or two years, due to acquisitions or new facilities? Has the proportion of debt grown rapidly, to reflect a new financing strategy? If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 5: Examine the income statement. Look for trends over time. Calculate and graph the growth of the following entries over the past several years. Revenues (sales) Net income (profit, earnings) Are the revenues and profits growing over time? Are they moving in a smooth and consistent fashion, or erratically up and down? Investors value predictability, and prefer more consistent movements to large swings. For each of the key expense components on the income statement, calculate it as a percentage of sales for each year. For example, calculate the percent of cost of goods sold over sales, general and administrative expenses over sales, and research and development over sales. Look for favorable or unfavorable trends. For example, rising G\&A expenses as a percent of sales could mean lavish spending. Also, determine whether the spending trends support the company's strategies. For example, increased emphasis on new products and innovation will probably be reflected by an increased proportion of spending on research and development. Look for non-recurring or non-operating items. These are "unusual" expenses not directly related to ongoing operations. However, some companies have such items on almost an annual basis. How do these reflect on the earnings quality? If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 6: Examine the shareholder's equity statement. Has the company issued new shares, or bought some back? Has the retained earnings account been growing or shrinking? Why? Are there signals about the company's long -term strategy here? If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 7: Examine the cash flow statement, which gives information about the cash inflows and outflows from operations, financing, and investing. While the income statement provides information about both cash and noncash items, the cash flow statement attempts to reconstruct that information to make it clear how cash is obtained and used by the business, since that is what investors and creditors really care about. If you find anything that looks very suspicious, research the information you have about the company to find out why. Step 8: Find information about your company from yahoo finance, cnn money etc including ratios, betas and any other type of information that may help you understand the company you are analyzing. You do not need to do as much calculating as much as gathering of data. - Obtain data for the company's key competitors, and data about the industry. - Review the market data you have about the company's stock price, and the price to earnings (P/E) ratio. Try to research and understand the movements in the stock price and P/E over time. Determine in your own mind whether the stock market is reacting favorably to the company's results and its strategies for doing business in the future. - Review the evaluations of stock market analysts. These may be found at any brokerage site, or from various locations on yahoo, cnn money and other finance sites. Step 9: Review all of the data that you have generated. You will probably find that there is a mix of positive and negative results. Answer the following question: "Based on everything I know about this company and its strategies, the industry and the competitors, and the external factors that will influence the company in the future, do I think this company is worth investing in for the Iong term?" Explain why based on the data that you present. Step 10: Summarize all the information in no more than a 1-3 page written report and an appendix of tables