Home - EnglishAn... LAY THE FOUNDA... Apply Spartan St... Scenario: This is your second interview with a prestigious brokerage firm for a job as an equity analyst. You survived the morning interviews with the Vice President of Equity. Everything has gone so well that they want to test your ability as an analyst. You are seated in a room with a come names of two companies --Ford (F) and Microsoft (MSFT). You have 90 minutes to complete the following tasks. Respond in the Week 2 Discussion with your insight on items 4, 5, and 6. Download the annual income statements, balance sheets, and cash flow statements for the last four fiscal years from MarketWatch (www. each company's stock symbol and then go to "financials." Export the statements to Excel by clicking the Export button. 1. Find historical stock prices for each firm from Yahoo! Finance (finance.yahoo.com). Enter your stock symbol, click "Historical Prices" enter the proper date range to cover the last day of the month corresponding to the date of each financial statement. Use the closing adjusted close). To calculate the firm's market capitalization at each date, multiply the number of shares outstanding (see "Basio" on to under "Weighted Average Shares Outstanding") by the firm's historical stock price. 2. For each of the four years of statements, compute the following ratios for each firm: Valuation Ratios Price-Earnings Ratio (for EPS, use Diluted EPS Total) Market-to-Book Ratio Enterprise Value to EBITDA . (For debt, include long-term and short-term debt; for cash, include marketable securities.) Profitability Ratios Operating Margin Net Profit Margin Operating Margin Net Profit Margin Return on Equity Financial Strength Ratios . Current Ratio Book Debt-Equity Ratio Market Debt-Equity Ratio Interest Coverage Ratio (EBIT + Interest Expense) 3. Obtain industry averages for each firm from Reuters.com (www.reuters.com/finance/stocks). Enter the stock symbol in the field under "Search Stocks," se a company from the list, and then click the Financials button a Compare each firm's ratios to the available industry ratios for the most recent year. (ignore the "Company" column, as your calculations will be b. Analyze the performance of each firm versus the industry, and comment on any trends in each individual firm's performance. Identify any strengths om weaknesses you find in each firm. QUESTIONS FOR DISCUSSION 2 RESPONSE: 4. Examine the Market-to-Book ratios you calculated for each firm. Which, if any, of the two firms can be considered "growth firms" and which, if any. can be considered "value firms"? 5. Compare valuation ratios across the two firms. How do you interpret the difference between them? 6. Consider the enterprise value of each firm for each of the four years. How have the values of each firm changed over the time period? Home - EnglishAn... LAY THE FOUNDA... Apply Spartan St... Scenario: This is your second interview with a prestigious brokerage firm for a job as an equity analyst. You survived the morning interviews with the Vice President of Equity. Everything has gone so well that they want to test your ability as an analyst. You are seated in a room with a come names of two companies --Ford (F) and Microsoft (MSFT). You have 90 minutes to complete the following tasks. Respond in the Week 2 Discussion with your insight on items 4, 5, and 6. Download the annual income statements, balance sheets, and cash flow statements for the last four fiscal years from MarketWatch (www. each company's stock symbol and then go to "financials." Export the statements to Excel by clicking the Export button. 1. Find historical stock prices for each firm from Yahoo! Finance (finance.yahoo.com). Enter your stock symbol, click "Historical Prices" enter the proper date range to cover the last day of the month corresponding to the date of each financial statement. Use the closing adjusted close). To calculate the firm's market capitalization at each date, multiply the number of shares outstanding (see "Basio" on to under "Weighted Average Shares Outstanding") by the firm's historical stock price. 2. For each of the four years of statements, compute the following ratios for each firm: Valuation Ratios Price-Earnings Ratio (for EPS, use Diluted EPS Total) Market-to-Book Ratio Enterprise Value to EBITDA . (For debt, include long-term and short-term debt; for cash, include marketable securities.) Profitability Ratios Operating Margin Net Profit Margin Operating Margin Net Profit Margin Return on Equity Financial Strength Ratios . Current Ratio Book Debt-Equity Ratio Market Debt-Equity Ratio Interest Coverage Ratio (EBIT + Interest Expense) 3. Obtain industry averages for each firm from Reuters.com (www.reuters.com/finance/stocks). Enter the stock symbol in the field under "Search Stocks," se a company from the list, and then click the Financials button a Compare each firm's ratios to the available industry ratios for the most recent year. (ignore the "Company" column, as your calculations will be b. Analyze the performance of each firm versus the industry, and comment on any trends in each individual firm's performance. Identify any strengths om weaknesses you find in each firm. QUESTIONS FOR DISCUSSION 2 RESPONSE: 4. Examine the Market-to-Book ratios you calculated for each firm. Which, if any, of the two firms can be considered "growth firms" and which, if any. can be considered "value firms"? 5. Compare valuation ratios across the two firms. How do you interpret the difference between them? 6. Consider the enterprise value of each firm for each of the four years. How have the values of each firm changed over the time period