SCENARIO

• You are a financial analyst working for ProVest Bank.
• Your client, Amy, just receive an inheritance a month ago, and she is now considering to invest in one of the two companies she found promising. She has exactly $10,000 to invest in shares, no more no less.

Company 2-Company 2 is a multibillion- dollar Australian retailer that sells electronics, as well as major and small appliances. The business has 315 stores in Australia and New Zealand and growing. With the current climate that encourages people to work from home and stay at home, the business is reaping benefits from selling home electronics for work and entertainment.

Share price as of 30 June 2019 was $25.85, and now it is sitting between $45.76 and $50.94.

Company 3-Company 3 is a multimillion-dollar Australian manufacturer in food industry. It is one of the significant players in the Australian plant-based beverage market. The company does export organic plant-based range to other countries, as organic food has becoming more and more in demand.

Share price as of 30 June 2019 was $4.80, and now it is sitting between $4.40 and $5.70.

Company 2 Consolidated Statement of Profit of Loss For the year ended 30 June 2019 Note 2017 2018 2019 $M $M $M REVENUE Revenue from sale of goods 5,628.0 6,854.3 7,095.3 Cost of sales (4,397.5) (5,384.1) (5,568.2) Gross profit 1,231 1,470.2 1,527.1 Other income 2.0 1.1 2.4 Sales and marketing expenses (580.1) (695.1) (731.0) Occupancy expenses (248.6) (299.7) (306.4) Administration expenses (36.2) (48.2) (44.5) Acquisition costs (22.4) Other expenses (75.3) (77.2) (74.0) Net finance costs 5 (10.7) (16.6) (14.3) PROFIT BEFORE INCOME TAX EXPENSE 259.2 334.5 359.3 Income tax expense (86.8) (101.3) (109.5) PROFIT AFTER INCOME TAX EXPENSE FOR THE YEAR 172.4 233.2 249.8Company 3 Consolidated Statement of Prot of Loss For the year ended 30 June 2019 $000 $000 REVENUE Revenue from sale of goods 170,444 262,481 352,987 Cost of sales (119,763) (201,308) (265,754) Other income 307 3,634 Gain from disposal of land 47,540 3,330 EXPENSES Marketing expenses (3,964) (3,815) (9,232) Selling and distribution expenses (17,352) (27,899) (33,736) Administrative expenses (9,421) (8,132) (11,636) Depreciation and amortisation (6,439) (11,392) (13,413) Acquisition costs (1,227) (1,305) (7,131) Other expenses (2,232) (119) (1,441) Net finance costs (1,151) (2,635) (3,471) Share of profits of associates accounted for using the equity method 372 480 480 PROFIT BEFORE INCOME TAX EXPENSE 57,114 9,348 14,617 Income tax expense (6,483) (1,809) (1,902) PROFIT AFTER INCOME TAX EXPENSE FOR THE YEAR 50,631 7,539 12,715