Final Project Part II

Part II Overview

For this part of the final project, you will be given a scenario in which you are asked to illustrate your financial computation and analysis skills. This part of the assessment addresses the following course outcomes:

Compute financial ratios, time value, variables, and returns using industry standard tools for optimizing financial success

Analyze corporate financial data for multiple companies in evaluating past and future financial performances

Part II Prompt

For this section of your employment exam, you will select two companies. The first company needs to come from your TDAU thinkorswim portfolio. The second needs to be a competitor of the first company from the same industry. You will be responsible for collecting, synthesizing, and making decisions regarding both companies. After evaluating these companies financial data, you will then decide which companys stock is the better investment. This section of your employment examination must be submitted in two parts.

Part A will contain the workbooks that house all of your quantitative data and formulas, along with any of the information that is relevant for your chosen companies.

Part B will contain your answers to the questions asked below, composed in a cohesive manner. If you are referring to data that is found within the workbooks in Part A, be sure to include a citationfor example, rate of return is 3.570 USD (E64, WB2), where E64 is the cell that the calculation took place in and WB2 is designating workbook 2. This ensures that your instructor can quickly and accurately check data entry, formula use, and financial calculations. Your submission must address the following critical elements:

I. Preparing the Workbooks

A. Download the annual income statements, balance sheets, and cash flow statements for the last three completed fiscal years for your chosen companies. This information must be included in your final submission.

B. Prepare a worksheet for each of the companies to display their financial data for the last three fiscal years. Ensure your data is accurate and organized. Include these worksheets as a workbook in your final submission.

C. Find historical stock prices for both companies and add this information to the respective spreadsheets. Consider the appropriate date range you should use.

II. Three-Year Returns A. What is the three-year return on the stock price of the first company (Company A)? How is the stock performing? Ensure that you use the appropriate formula in your spreadsheets to calculate the three-year return on the given companys stock price.

B. What is the three-year return on the stock price of the second company (Company B)? How is this stock performing? Ensure that you use the appropriate formula in your spreadsheets to calculate the three-year return on your chosen companys stock price.

C. How do these two stocks compare in terms of three-year returns? What does this indicate about these two companies?

III. Financial Calculations A. Using the appropriate spreadsheets, which are to be included in the workbooks, calculate the price-to-earnings ratio for the last three fiscal years of the given and your chosen companies. Be sure that you are entering and using the correct formula.

B. Using the appropriate spreadsheets, which are to be included in the workbooks, calculate the debt-to-equity ratios for the last three fiscal years of the given and your chosen companies. Be sure that you are entering and using the correct formula.

C. Using the appropriate spreadsheets, which are to be included in the workbooks, calculate the return-on-equity ratios for the last three fiscal years of the given and your chosen companies. Be sure that you are entering and using the correct formula.

D. Using the appropriate spreadsheets, which are to be included in the workbooks, calculate the return on assets for the last three fiscal years of the given and your chosen companies. Be sure that you are entering and using the correct formula.

E. Using the appropriate spreadsheets, which are to be included in the workbooks, calculate the profit margins for the last three fiscal years of the given and your chosen companies. Be sure that you are entering and using the correct formula.

F. Using the appropriate spreadsheets, which are to be included in the workbooks, calculate the free cash flows for the last three fiscal years of the given and your chosen companies. Be sure that you are entering and using the correct formula.

IV. Industry Averages

A. Obtain current industry averages of three of the financial calculations above for both companies and add this information to your spreadsheet for comparison. Ensure the accuracy and organization of your data.

B. In this context, how is each companys financial health? How do these two companies compare to one another? Consider the appropriate date range you should use.

V. Performance Over Time

A. Analyze the performance of the Company A over time. What financial strengths and weaknesses does this company have? Consider addressing the free cash flows and ratios you calculated earlier.

B. Analyze the performance of your Company B over time. What financial strengths and weaknesses does this company have? Consider addressing the free cash flows and ratios you calculated earlier.

C. Analyze how the data differ between these two companies. Why do you think this is? Consider addressing the free cash flows and ratios you calculated earlier.

VI. Investment

A. Are the companies considered growth or value companies? Why?

B. Which companys stock is the better investment? Consider supporting your answer with data.

Final Project Part II Rubric Guidelines for Submission: This part of the final project will be submitted in two parts. Part A will contain the workbooks that house all of your quantitative data and formulas, along with any of the information that is relevant for your chosen company. Part B will contain your answers to the prompts, composed in a cohesive manner. Part B should use double spacing, 12-point Times New Roman font, and one-inch margins. Citations should be formatted according to APA style.

Abbott Labs (ABT)

Period Ending	31-Dec-15	31-Dec-14	31-Dec-13
Assets
Current Assets
Cash And Cash Equivalents	5,001,000	4,063,000	3,475,000
Short Term Investments	1,124,000	397,000	4,623,000
Net Receivables	3,418,000	3,586,000	6,514,000
Inventory	2,599,000	2,643,000	2,693,000
Other Current Assets	2,013,000	2,867,000	1,942,000
Total Current Assets	14,155,000	13,556,000	19,247,000
Long Term Investments	4,041,000	229,000	119,000
Property Plant and Equipment	5,732,000	7,869,000	5,971,000
Goodwill	9,638,000	10,067,000	9,772,000
Intangible Assets	5,562,000	6,198,000	5,735,000
Accumulated Amortization	-	-	-
Other Assets	-	-	-
Deferred Long Term Asset Charges	2,119,000	3,288,000	2,109,000
Total Assets	41,247,000	41,207,000	42,953,000
Liabilities
Current Liabilities
Accounts Payable	5,683,000	5,350,000	5,948,000
Short/Current Long Term Debt	3,130,000	4,437,000	3,173,000
Other Current Liabilities	373,000	680,000	386,000
Total Current Liabilities	9,186,000	10,467,000	9,507,000
Long Term Debt	5,871,000	3,393,000	3,388,000
Other Liabilities	4,864,000	5,708,000	4,791,000
Deferred Long Term Liability Charges	-	-	-
Minority Interest	115,000	113,000	96,000
Negative Goodwill	-	-	-
Total Liabilities	20,036,000	19,681,000	17,782,000
Stockholders' Equity
Misc Stocks Options Warrants	-	-	-
Redeemable Preferred Stock	-	-	-
Preferred Stock	-	-	-
Common Stock	12,734,000	12,383,000	12,048,000
Retained Earnings	25,757,000	22,874,000	21,979,000
Treasury Stock	-10,622,000	-8,678,000	-6,844,000
Capital Surplus	-	-	-
Other Stockholder Equity	-6,658,000	-5,053,000	-2,012,000
Total Stockholder Equity	21,211,000	21,526,000	25,171,000
Net Tangible Assets	6,011,000	5,261,000	9,664,000
Current Ratio	1.54	1.30	2.02
Debt/Equity Ratio	0.94	0.91	0.71
Free Cash Flow	1,856.0	2598	2179
Earnings Per Share	1.77	1.51	1.65
Price/Earnings ratio	25.37	29.74	23.42
Return on Equity %	20.70	9.78	9.93
Net Profit Margin(%)	21.68	11.28	11.79