Microsoft Word - Group Assignment 2 MBA
Financial Management – Individua Assignment
This is an individual assignment. In this assignment you will be applying the concepts you learned in class
to a company of your choice. Please submit your work in word with excel pasted into your document. See
myCourses for exact date of submission. Use the financial statements of the last four years.
The report should include the following:
Part #1. Operational Performance
Use the ratios we discussed in class and listed in your textbook to analyze your company historical
performance & liquidity and compare it to industry averages.
Part #2 Sustainable Growth Rate
Analyze your company’s sustainable growth rate (and its components). Indicate where does your company
stands in that regard.
Based on what you learned about your company’s growth forecast their financial needs.
Topic #3 Capital Structure
Perform an analysis of your company’s financing strategy/capital structure. Explain the different financial
instruments used by your company (equity, debt, etc.). Analyze historical ROE and ROIC performance, and
determine how much of ROE is contributed by operational performance & how much is contributed by
capital/financing structure.
Topic #4 Cost of Capital
Calculate your company’s cost of capital. Indicate how cost of debt & cost of equity are calculated
Topic # 5 Valuation
Perform a valuation of your company’s equity using the models you learned in class. For discounted cash flow
valuation technique assume a growth rate of sales equal to the historical average growth rate. Compare your
estimation to actual share prices and indicate whether your company is overvalued or undervalued.