Pepsi Vs. Coca Cola

inv_project-fall_2011_0

INVESTMENTS FINA 4313

Fall Semester, 2011

Investments Research Project

This is a group task (three or four students per group) and comprises of a research/written report (85%) and a group presentation (15%) The report is divided in three milestones; the due date for these milestones will be set out by your instructor. The report is to be submitted
BEFORE 4pm on 3rd December 2011.

 

Your starting point for this project is:

 

1.  Your group has to select a public company listed on the New York Stock Exchange (

or Saudi

Arabia)

 

Note:
  You can select from wide range of companies such as pharmaceutical company, telecommunications, Retail, Automobile etc But you should not select a banking or insurance company.

 

2.  You have to inform your instructor regarding your selection of the company.

 

3.  When selecting a company, you should be aware of the industry your company operates in. Also identify the other companies which are in competition with your company.

 

4.  Collect media articles and any news of interest about your company.

 

5.  Acquaint yourself with the company as much as possible, sound knowledge and understanding about the company’s financial structure will help you in successfully handling this project.

 

6.  Obtain five consecutive annual reports (starting from the latest and four previous years’) of your company.

 

7.  Look out for company’s website. Browse through company’s website and identify relevant information.

 

8.  Reports without referencing and bibliography will NOT be accepted OR marked by your instructor.

Milestone 1 (15 %)

 Background of the Company,

What type of industry does it operate in, ownership structure of the company: wholly American (Kingdom of Saudi Arabian) owned or partly foreign owned, main business competitors, Any interesting past or current information related to the financial aspect of your company.

What are the major sources of funds for your company?

Identify and explain the short term and long term sources of finance for the company. What are the sources of revenue?

(Look out for the financial statements such as balance sheet, income statement and statement of cash flows)

Milestone 2 “Calculation and compilation of Ratios” (30 %)

 

In this part you are required to:

1.  Calculate
the following ratios of your company for
three consecutive years:

Liquidity Ratios- Current ratio and liquid ratio

Activity Ratios- Any two ratios

Profitability Ratios- Any two ratios

Leverage Ratios- Any two Ratios

Valuation/Performance Ratios- Any two ratios  

2. Having identified the major competitors of your company,
chose one firm
which is in direct/close competition to your company. Calculate the above ratios for this firm as well.

3.  Research and find industry benchmark ratios.

 

http://www.anz.com/aus/Small-Business/Tools-Forms-And-Guides/Benchmark-Your-Business/Industry-Analyser/default.asp

 

Milestone 3 “Analysis and Interpretation” (30 %)

 

As you all must be aware that mere calculation of ratio in itself is a meaningless exercise, it is the interpretation and analysis of significant results indicated by these ratios that are of real value.

Interpretation can be achieved by

i.comparing ratios over a period of time or

ii.comparing ratios of your company with that of other firms in the same industry or iii.comparing with the industry benchmarks.  

Comparison:

 

You are required to:

Compare and analyze the ratios of the latest year with that of previous two years.

Compare and analyze the ratios of the company with the ratios of the direct/close competitor firm.

Compare and analyze the ratios of your company with that of industry benchmarks.

Interpretation: In the light of these ratios and comparisons you have to document your comments regarding:

 

Company’s ability to meet short term liabilities and cash commitments; Are there any short term financial problems faced by your company?

Effectiveness with which the company’s financial resources are utilized; What idea do you get about the operational efficiency of the business?

Ability of your company to generate profits from sales, assets employed and shareholder investment

Extent to which debt funds are used in the business,

How effectively the shareholders’ investments are performing in terms of returns and maturity.

 

Finally provide the future financial outlook of your company in terms of profitability and shareholder’s returns.

 

Compilation of all the three milestones is required in the form of a Business Report at this stage (Marks 10%):

The format of the report should be:

Cover page

Contents page

Abstract

Introduction

y Findings

Conclusion

References & Bibliography

Appendices

 

 
List of Resources for the project: Suggestive, not exhaustive list

·

Official website of the Capital Market Authority

·

http://www.tadawul.com.sa

: Tadawul official website

·

Tadawul

: Tadawul forums website

·

Saudi Virtual Tadawul

: Virtual Tadawul site that simulate Saudi Tadawul (the easy way to learn Saudi Stocks)

· 
http://www.anz.com/aus/Small-Business/Tools-Forms-And-Guides/Benchmark-Your-Business/Industry-Analyser/default.asp
 

· Company Website, Annual Reports, Newspaper and Media Articles

When you complete the assignment you should but a graphs and charts for analysis ..