Company Analysis

Subject:
The task is to compare and contrast the historical (for the last 2 years) and expected future performance of a listed company and a competitor in a similar line of business, and present the findings in the form of a report which will cover both qualitative and quantitative performance elements in a logical cohesive format.
The qualitative component of the discussion should include (but is not constrained to):
 A BRIEF background on each company including how they are placed within the industry.
 A BRIEF overview of the recent stock price movements for both companies.
 The impact of general local and global economic conditions on the companies (if any).
 Industry trends and an assessment of each company’s ability to cope with these.
The quantitative component should include:
 An initial analysis of trends in the items contained in the profit and loss statements, balance sheets and statements of cash flows; appropriate relevant ratios ( do not use multiple ratios which measure the same thing) measuring profitability, liquidity, working capital management, leverage/gearing and financial risk (market-based ratios).
 A highlighting of the most important changes within these ratios and an identification of the reasons for these changes.
 A comparison of the quantitative analysis for the two companies and an identification of the reasons for any differences.
Taking into account the quantitative and qualitative analysis, a recommendation which will fall into one of the following three categories is regquired:
1. Invest in the company
2. Invest in the competitor
3. Invest in neither
The report should include a conclusion that comments on the strengths and weaknesses of the overall analysis encompassing what the analysis has accomplished and what are its limitations