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Sample papers have been posted here for your perusal only. PLEASE DO NOT REPLICATE the sample papers as this does not represent original work; those who do not comply with this request will be marked down at least one grade level

You will demonstrate your investment analysis strengths in the current event paper by selecting a news article from the financial or business literature concerning a publicly traded company that is of interest to you. The article should concern any of the following topics: recent financial results and/or sales & profit outlook; new business development such as launching a new product or service; booking new orders; entering a new market; merger, acquisition or restructuring; public offering of debt or equity securities; and other such events that you deem significant from a stock price perspective.

Your task in this paper is to summarize the content of the article, analyze its investment implications for the value of the stock, and based on your investment appraisal, make a buy, sell, or hold recommendation on the stock of the publicly traded company you choose. This is an opportunity for you to demonstrate your competence your proficiency in applying the concepts covered in this course.

1) The executive summary should begin with the buy, hold or sell recommendation in relation to the content of the news article you are writing about. The rest of the paper should explain the reason for your recommendation. A table of contents may also be included if the report has multiple sections and subheadings.

2) Calculations and support documentation should be included in the appendix, but relevant statistical support (i.e., bottom line figures such as rates of return, valuation, and so forth) should also be included in the body of the text.

3) Your goal should be to determine what the content of the news article means for the investment merits of the stock. Does the event covered in the article have a positive, negative or neutral effect on the stock price? Explain why. How does this affect your investment recommendation? For example, a company may announce increased order rates for its core business, thereby increasing its backlog of unfilled orders. One may infer that such a development improves the sales & profit outlook, and thus make the stock a likely candidate for further price appreciation. Conversely, a delayed shipment or lower demand would have the opposite effect.

Your current event paper will be graded on content (60%), organization (20%) and clarity (20%). The text portion of the paper needs to be between 6-8 pages in length; it must be typed and double-spaced. If you are including statistical tables, graphs and charts in your paper, they can either be incorporated into the body of the text or referenced in your text and placed in an Appendix.

Please include a bibliography of the references used in your paper. A minimum of three additional references [other than the source of the article, the required textbook or recommended workbook and case book] must be included in order to be eligible for full credit. This implies a minimum total of 5 reference sources [or 6 if you decide to use the workbook and case book]. The bibliography should follow the APA reference style. The APA style refers to references in the text by author and year; e.g., (Jones, 1995) or (Smith, 1996; Rizzo, 1994).

Current Event Paper: Campbell Soup Company FIN 631 Securities Analysis & Portfolio Management National University October 2015 By: Stephanie Riggs, P.E. Executive Summary Bolthouse Farms established itself as a leader in making fresh food accessible, available, and affordable. This is important to a variety of generations in 2015 who have learned for themselves and through countless studies about the impact of nutrition on the human body. Cost and availability were inhibitors to the average consumer since fresh foods are typically more expensive and no one likes to spend time cutting up carrots when they need to be cleaning, doing homework or better yet sleeping! Vegetables in general have a bad rap. Through clever marketing similar to that of junk food and specifically, soft drinks, Bolthouse Farms made fresh fun. Campbell Soup Company paid attention and acquired Bolthouse Foods, finding its anchor for their diversification play into the fresh foods consumer space. Although the Great Recession has impacted the food sector similarly to many other consumer sectors, the success of Bolthouse and continued acquisitions of other fresh food companies puts Campbell in a good position for future growth. The stock purchase recommendation for investors is to buy shares of Campbell Soup Company. Article Summary In the October 2015 issue of Harvard Business Review, Jeffrey Dunn, CEO of Bolthouse Farms, describes how he led the company to make carrots cool. His previous experience was in the soft drink industry for Coca-Cola. The term \"Coke\" is used generically to describe many dark colored sodas and the brand is consumed a billion times a day globally (Dunn, 2015)! His question was how can Bolthouse be as ubiquitous as soft drinks and he worked to apply similar strategies to execute a plan that paid off for both the company and the consumer. Bolthouse Farms caught the attention of Campbell Soup Company who acquired Bolthouse Farms in August 2012. The acquisition seemed odd for Campbell but aligned with their strategy to move into the fresh food market to diversify and keep up with the growing consumer demand for fresh foods. Bolthouse Farms benefitted as well with access to food scientists and distributor network to further their foothold in the retail space. The article provides good insight to a potential investor to the evolution of Campbell's diversification play into the fresh foods market. Company Information Campbell Soup Company (Campbell) is a global producer and distributor of packaged and fresh foods. Campbell was founded in 1869 by Joseph Campbell, who sold fruit and his partner, Abraham Anderson, who was an icebox manufacturer (Campbell Soup Company, 2015). After the company changed hands a few times and was no longer even part of the Campbell family, the first can of tomato soup was introduced in 1895. Their long history includes acquisitions that began first with Pepperidge Farm in 1961 and has been fairly constant in their growth strategy even through 2015. With their latest round of both domestic and global acquisitions, including Bolthouse Farms, Campbell is diversifying their brands to match their strategy (Rappeport, 2012). From soups to crackers to juices, Campbell is well known for its name recognition and brand presence in a large majority of consumer's homes. When Denise Morrison came on board in 2011 as President and CEO, Campbell recognized the need to diversify their brand presence due to new consumer demands for fresh, accessible food. This move did not align with their physical presence in grocery stores since most of Campbell's product are in the middle of the store. The move into fresh foods moved Campbell's to the perimeter of the store setting the stage to serve a different group of consumers and competitors. Company Analysis A stock valuation exercise requires full understanding of the all the benefits and risk factors that affect the company under review. A SWOT analysis encompasses an internal evaluation of strengths and weaknesses as well as a review of the external factors around opportunities and threats. Beginning with Strengths, Campbell has a very strong level of brand recognition globally. More than 80% of households in the United States have Campbell Soup in their house (Campbell Soup Company SWOT, 2015)! The acquisitions over the years of Pepperidge Farms and Pace along with intense investment in research and development (R&D) of new brands like Prego sauces and V8 juices continue to strengthen their presence in the packaged food market. Campbell's R&D investments have not only developed new products but improved and modified existing brands to meet the needs of the consumer. Campbell's improved several of their condensed soups by offering reduced fat, cholesterol and sodium varieties. They have also utilized clever marketing to appeal to the healthy side of the consumer by highlighting daily servings of fruits and vegetables offered in their products. An evaluation of Campbell's Weaknesses brings us to their reliance on a major discount store, Wal-Mart. Nearly 20% of Campbell's sales are attributed to their relationship with WalMart. Although the deep discounter is perceived as a stable entity, Wal-Mart has come under fire recently for their employment practices and fair pay. Any upset or delay in sales to WalMart could have a significant impact on Campbell's revenue stream. Opportunities abound for Campbell as the consumer demand for healthier packaged foods and fresh foods have increased dramatically in recent years as studies continue to educate the consumer about the link between food and overall health and well being. Campbell's dedication to R&D provides them better insights on how to serve this market. Campbell also continues to grow and optimize their presence in the international market with a recent acquisition in China and strengthening of existing brands in the Indonesian market. The US Foodservice industry also brings opportunity for growth in both the US and Canada. As consumers recover from the Great Recession, they have more disposable income to go out to eat and spend where they may have avoided this in years past. Threats for Campbell exist in the regulatory space where consumers who are concerned about the food they are putting in their bodies are petitioning the government for increased food transparency. This will enable the consumer to make better decisions and drive companies to produce healthier products. Added sugars and manufactured fats have drawn a lot of attention since both have been linked to chronic illnesses both in children and adults. Once highlighted, consumers have been educated about how prolific sugar is used in most packaged foods as a preservative for longer shelf stability. Campbell's play is a commitment to remove high fructose corn syrup from many of their products by 2018 (Westervelt, 2015). Additionally, the Food and Drug Administration has many requirements for compliance by all food manufacturers. The administrative burden is significant and operations checks and balances are costly to implement. Although Campbell has a solid market share, competition is fierce from both local, regional, national and international producers. Firms like Heinz and General Mills nationally and Mondelez internationally hold Campbell to continue to strive to maintain historical brand loyalty and product quality to maintain this strong market share. Additionally, the labor market in the United States affects all employers and any changes in regulations on workers hours or wages impact Campbell the same as others, increasing their costs and eating into their operating profits. Stock Valuation When Campbell's new CEO arrived in 2011, they had shifted their strategy to move into new growth markets including grocery store perimeters domestically, new geographies internationally and a vast assortment of new foods (Campbell Soup Company, 2015). Through 2012 and 2013, growth continued with additional acquisitions but it was not as much as had been forecasted. Then in 2014, Campbell owned up to what the rest of the industrial population felt in a lack of continued growth and even slowing of the economy. Campbell's 2015 has ended with talk of workforce reductions, operating efficiencies and a reforecast in the growth expected in the coming years. Their growth is not as predicted but they are not alone in this situation. In reviewing some key financial indicators, the return on equity (ROE) is a key place to begin a review. The ROE has varied considerably for Campbell in the past 5 years. In 2011 and 2012, Campbell enjoyed 30%+ ROE; however, in 2013 when Campbell recognized the impact of the Bolthouse Farms acquisition their ROE dropped to 18%. In the acquisition, Campbell took on additional long-term debt as well as paid for Bolthouse reducing their net income considerably when compared to prior years. Campbell recovered in 2014 and 2015 with ROE moving into the mid 20% range proving their ability to integrate and take advantage of the new market and position therein with the Bolthouse Farms product line. Next, a review of both Campbell, their competitors and the industry price to earnings (P/E) multiple helps to determine how well Campbell compares in the market to the earnings they generate per share. The processed and packaged goods industry has a P/E of 30.41 (Yahoo, 2015). A close competitor, General Mills, has a P/E of 27.01 (General Mills, 2015). The evolution over the past 5 years of Campbell's P/E lends similar evidence of the Bolthouse Farms acquisition as well as Campbell's overall strength in the packaged foods market. Their P/E in 2015 was 23.27. Considering their retention ratio and ROE, Campbell's potential growth rate based 2015 financials is 11%. Applying this growth to the earnings per share (EPS) in 2015 of $2.21, an investor could assume that the future EPS would be $2.45. Looking back at the P/E, the SWOT and confidence in the diversification strategy, an investor would be safe to consider that the P/E multiple for Campbell in the coming years would range from 23-25-27. The results of the intrinsic value calculation based on the P/E multiple is as follows: P/E Multiple Future EPS Intrinsic Stock Value 25 $2.45 $61.25 27 $2.45 $66.15 29 $2.45 $71.05 The common stock price as of October 16, 2015 was $49.49. The most conservative estimate of intrinsic value of Campbell's stock tells a potential investor that Campbell's stock is currently undervalued and a purchase of shares should be considered. Bibliography About Us. (2015). Retrieved from: http://www.campbellsoupcompany.com/about-campbell/ Annual and Other Reports. (2015). Retrieved from: http://investors.generalmills.com/quarterlyearnings Annual Reports. (2015). Retrieved from: http://investor.campbellsoupcompany.com/phoenix.zhtml?c=88650&p=irol-reportsannual Brown, K.C. & Reilly, F.K. (2012). Investment Analysis & Portfolio Management. Mason, OH. Cengage Learning. Campbell Soup Company SWOT Analysis. (2015). Campbell Soup Company SWOT Analysis, 1-8. Persistent link to this record (Permalink): http://search.ebscohost.com/login.aspx?direct=true&db=buh&AN=103203737&site=ehostlive Competitors. (2015). Retrieved from: http://finance.yahoo.com/q/co?s=CPB+Competitors Dunn, Jeffrey. (2015, October). How I Did It...The CEO of Bolthouse Farms on making Carrots Cool. Harvard Business Review. 43-46. Historical Stock Price. (2015). Retrieved from: http://investors.generalmills.com/historical-stockprice Rappeport, A. (2012, July 10). Campbell Soup set to acquire Bolthouse Farms. Financial Times, p. 14. Retrieved from http://go.galegroup.com/ps/i.do?id=GALE%7CA295822421&v=2.1&u=nu_main&it=r&p= AONE&sw=w&asid=90ecc5c8d9f17f94083e9e1bc80c9228 Westervelt, Amy. Big food is going green, but will consumers buy in? Kraft has taken synthetic dyes out of its macaroni and cheese and General Mills is cutting out artificial sweeteners. Will giant food manufacturers' sustainability plays pay off -- or do too many shoppers think big is bad? (2015, June 26). theguardian.com. Retrieved from http://go.galegroup.com/ps/i.do?id=GALE%7CA419515262&v=2.1&u=nu_main&it=r&p= AONE&sw=w&asid=fc4aa54601dd3fc0da9983db298337a1 Appendix A Calculations Return on Equity = (Net Income / Total Assets) / (1 - (Total Debt / Total Assets)) Retention Ratio = (Net Income - Dividends) / Net Income = (EPS - DPS) / EPS) Potential Future Growth = Retention Ratio * ROE Future EPS = Current EPS * Potential Future Growth Price to Earnings Multiple to Calculate Intrinsic Value = P/E Multiple * Future EPS Appendix B Personal Note from the Author Much of the dialogue in the paper on personal health and nutrition is based on my own knowledge, interest and experience. As a consumer of Bolthouse Farms Green Goodness smoothies and Pepperidge Farm sourdough bread nearly every morning, my family and I consume many of the products in this market sector. I know I have changed my own food habits and those of my family becoming choosier about how I shop and where in the store I look for the best for my family. Additionally, I have been in the corporate world for more than 15 years. My industry is subject to the Food and Drug Administration regulations where I have seen first hand the burden that a company carries to be in a regulated industry. Running head: BOEING: GOOD COMPANY AND GOOD STOCK Boeing Co. : Good Company and Good Stock Daniele Baroni FIN631 George Haloulakos, MBA, CFA April 25, 2015 1 BOEING: GOOD COMPANY AND GOOD STOCK 2 Executive Summary In this paper, I focus the attention on the American Company BOEING CO. (NYSE:BA) and how expectations and actual results can modify investors perceptions and its stock's prices fluctuations. BOEING has announced its 2015 first quarter's results on April 22th and I wanted to analyze the periods before and after this publication: the general market and investors' expectations two days before the announcement and how actually the stock price responded after that date. I wanted to provide a personal valuation of the newly published numbers and make a final decision on whether to buy, hold or sell the BA's stock and check if my estimate was in line with the market response and thesis by important stock-screening entities such as Yahoo!, The Street Ratings and Finviz. The industry analysis for this company and stock is very promising with high potentials in many fields; BA's market position is successful and its \"economic moat\" is pretty solid. Its recent financial figures are strong and positive. 2015's 1Q financial performance was of a double nature: above investors expectations EPS-wise, still a strong ROE performance but a sudden drop in cash flow (-92%) that turned out to be negative. However, I strongly believe that this company still earns a BUY rating due to the general positive outlook for the industry, successful management skills, growing EPS and choices of wise investments. BOEING: GOOD COMPANY AND GOOD STOCK 3 Section 1 - BOEING CO.: Good company and good stock? Boeing CO. designs, develops, manufactures, sells, services and supports commercial jetliners, military aircraft, satellites, missile defense, human space flights and launch systems and services worldwide. Together with United Technologies CO. (ticker: UTX), Boeing is the leading company in the Aerospace & Defense peer group. Its stock is currently selling for 153.33$ as of 4/21 and it has pretty much always risen from about 120$ in a little over than 4 months. The continuous rise has depicted by the graph below and the upward trends in all the Simple Moving Averages (over 20, 50 and 200 days). Its performance on a YTD-basis is +18.69%. Figure 1.1 - BA's stock price from July '14 to Apr '15 Source: FINVIZ Morningstar rates this stock as a Large Core meaning that, even though it is a mature company and may considered a Value investment, it is still growing fast in a very profitable BOEING: GOOD COMPANY AND GOOD STOCK 4 industry in which it has the greatest market share: for this reason it is also thought of a Growth stock. The industry analysis is very promising for many reasons: 1) the travel sector is continuing to grow as globalization still thrives and baby-boomers retire and exploit the leisure market; 2) the aerospace industry is continuously improving its technology and faces huge challenges for space travels (e.g. the \"Mars mission\" and the construction of new satellites); 3) the military spending will always be an important factor on rich countries' GDPs. BA stock has grown stronger also because of the market conditions we are in right now; after the mortgage crisis in 2008, the market in general has been pretty much consistent in the past years and it is still rising: these are the conditions for what it is called a \"bull market\": BA stock has historically performed really well under such conditions as the following table suggests (Haloulakos): The company's strengths can be seen in multiple areas, such as its revenue growth, (5.86% over the last 5 years, the industry average was 5.54%), notable ROE and ROI (42% and BOEING: GOOD COMPANY AND GOOD STOCK 5 32.60% respectively), good cash flow from operations ($4billion+ dollars in the past 4 years), impressive record of EPS growth (EPS = 31.6% on average for the last 5 years, industry = 14.61%). The company managed to grow both sales and net income at a faster pace than the average competitor. The weaknesses of BOEING are: very weak liquidity (Quick Ratio = 0.40) that has also decreased over the past year; and the Equity decreased by 41.74%, increasing the leverage and possibility of developing financial difficulties in the near future. However, the Street Ratings rate the stock a BUY because they feel that the company's strengths outweigh the fact that the company shows low profit margins (6% profit margin) and relatively high D/E ratio (=1.05). The Beta of the stock is 1.01, which is higher than the industry 0.90 but still bearable by the average investor. All this numbers say that BOEING is a good company and may carry an undervalued stock as all the major financial entities rate it a BUY and expect it to still rise in price. Section 2 - Article Illustration The article I decided to review is called \"What to expect when BOEING reports earnings results on April 22nd\" by the investing website The Street. It was published on the 21st of April, one day prior Boeing's announcement of new financial statement for the first quarter of 2015. The author focuses on and revises investors' expectation about number and figures for Boeing's performance of the beginning of the year. I want to remind the reader that stock prices BOEING: GOOD COMPANY AND GOOD STOCK 6 are pretty much driven by expectations and sentiments (i.e. the market value) rather than the pure equity value (i.e. the intrinsic value); for this reason, even if the actual numbers are positive but below expectations, we still might find a contraction in the value of the stock. This is the final goal of this paper: analyze how BA's stock price responds to the publication of actual figures, given the previous expectations by market analysts. The most important prediction the article focuses on is that Boeing has been forecast to report adjusted earnings (i.e. on a quarterly basis) of $1.81 per share on revenue of $22.49 billion for the quarter ended March 2015. Investors are also looking at trends and the figures for the same measures in 2014 were: $1.76 and $20.5 billions respectively. This tells us that an upward trend is expected. Boeing's financial strength is expected to rise due to its positive figures I discussed in Section 1 and, as the article points out, other points of interest: BA's revenue has outpaced the industry average by 0.4% and it seems to have been the most influential drive in earnings per share; BA has outperformed the S&P over the last 12 months and if the market stays bear as it is right now, it has the potential for higher prices (as I mentioned earlier thanks to Professor Haloulakos' table); On a year basis, BA's EPS has grown 25.5% in the last quarter of 2014 compared to the same one in 2013. The next section will provide my personal insight in the announcement with my recommendation and how the stock price responded on April 22nd and on the following days. BOEING: GOOD COMPANY AND GOOD STOCK 7 Section 3 - Stock's Response to Announcement As mentioned earlier, on April 22nd, the company announced its new financial figures for the first quarter of 2015. These are the financial highlights of the announcement: EPS of $1.9 beating analyst expectations of $1.81. While revenues and earnings both grew, the only worrisome element in the earnings was the steadily dropping operating cash flow. Operating cash flow fell by a whopping 92% this quarter compared to the same quarter last year. Boeing attributed this precipitous fall to the Dreamliner 787, which to date, has been a steady cash drain machine. With an investment of over 50 billion dollars in the plane, it remains to be seen how soon the returns will begin to accrue. Figure 2.1 - Financial Highlights for Boeing Source: MorningStar BOEING: GOOD COMPANY AND GOOD STOCK 8 The estimate for the intrinsic value I would make would concern the Cash Flow (through the DCF model) and how it impacts the number: the actual process and the rigorous evaluation of such elements go beyond the purpose of this paper, because they require a longer study and deeper research in order to evaluate the expected growth rate (g) for a 3-stage model (at least) and the exact required rate of return (r). Since the cash flow went down by 92% I would expect a strong decrease in the intrinsic value. However, this decrease could be outweighed by the consistent performance in EPS (that beat investors expectations) and the fact that strong decrease in cash flow is due to an investment that has been proven to be very successful in the past. So the market value for the stock could not be changing to a high extend; maybe it will go down for the first days or weeks but investors might still lay faith in this company for the future years. My expectations were confirmed by the market: in the following three days after the announcement was made the stock fell by 3.25% (from $153.4 to $148.4) (Figure XXX); I feel confident that the reason is because of the frightening drop in cash flow, but I think that a fall like that (-92%) would make a stock go even lower if it wasn't for the increase in EPS and the trust in the investments the company is making. BOEING: GOOD COMPANY AND GOOD STOCK 9 Figure 2.3 - Stock's response pattern APR 22nd Source: Yahoo! Finance RBC's Robert Stallard seems to agree with this point by saying: \"Boeing is perhaps learning the hard way that if you tell investors to focus on the cash flow, then you had better deliver it. Unlike the EPS, where the levers of program and long term contract accounting allow for more subjective outcomes, cash flow is what it is, and if inventory goes up more than hoped, or if the orders (and deposits) fail to materialize, then there aren't the same offsets as can be used in the income statement. This slow start to the year for cash, which we think investors may have partially anticipated, means that Boeing has a lot to do to meet or beat its full year cash flow target.\" In conclusion, I would still rate this company a BUY, or at least a HOLD, because of its high ROE, growing EPS and future investment expectations. Citigroup's Jason Gursky even believes that this weakness is a buying opportunity (Levisohn, 2015). Yahoo! recommendation is a solid BUY: BOEING: GOOD COMPANY AND GOOD STOCK Wall Street Journal also considers this a BUY stock: 10 BOEING: GOOD COMPANY AND GOOD STOCK 11 References! Ausick P. (2015, April 23). How Analysts Rate Boeing After Earnings. 24/7 WallSt. Retrieved at http://247wallst.com/aerospace-defense/2015/04/23/how-analysts-rate-boeing-afterearnings/ FINVIZ, Stock Quote for Boeing CO. Retrieved at: http://finviz.com/quote.ashx?t=BA&ty=c&ta=1&p=d Haloulakos G. A., Bull and Bear Market Cycles for BA Common Stock. Levisohn B. (2015, April 22). Boeing: It's All About the Cash Flow. Barron's. Retreived at http://blogs.barrons.com/stockstowatchtoday/2015/04/22/boeing-its-all-about-the-cashflow/?mod=yahoobarrons&ru=yahoo MORNINGSTAR, Stock Quote and Information for Boeing CO. Retrieve at: http://www.morningstar.com/stocks/XNYS/BA/quote.html Schiavo A. (2015, April 22). Will Boeing (BA) Stock be Helped Today by Earnings Beat. TheStreet. Retreived at http://www.thestreet.com/story/13121765/1/will-boeing-ba-stockbe-helped-today-by-earnings-beat.html?puc=yahoo&cm_ven=YAHOO