Competitor Analysis and Projected Future Industry Selection

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FINC 495 Project Descriptions
Stage Two - Competitor Analysis and Projected Future Industry Leader Selection
(10% of the Final Course Grade)
Due at the end of week 5
This project is closely aligned with the Course Outcomes and Finance Program Objectives.
Completion of this project can be used as part of a portfolio to show potential employers
the student is skilled at performing company valuations and financial statement analysis
and can be included on the student's resume.
YOUR SPECIFIC ASSIGNMENT
1. Introduction (The paper should begin with a short introduction (explains the purpose of the
paper and provides an overview of the contents that follow) (5% of the project grade)
2. Complete a ratio analysis of the top three (3) competitors in the industry using the
company’s financial statements. (20% of the project grade)
You may wish to utilize some of the "managerial" financial statements that your textbook
illustrates, such as the Managerial Balance Sheet.
The ratio analysis should include:
a) 5-year trend analysis of each company selected and compared to the industry averages
and
b) competitive analysis of the selected major competitors using four main standards:
profitability, liquidity, debt, and return on equity.
3. Establish growth projections for three (3) top competitors using established methods,
including pro forma income statements and balance sheets for the coming year. (15% of the
project grade).
The growth projections should be based on the global and domestic economies trends,
industry conditions, and the industry’s opportunity to grow you investigated in Stage One of
the project.
4. As a result of your findings and estimations, choose one company as the projected future
industry leader. Explain your choice. (10% of the project grade). Please also include a
discussion of the company's business model, core products or services, growth prospects
and key cost items. If the company that is selected is engaged in foreign markets, you will
need to discuss the potential for growth of those markets and any special risks those markets
may pose, and risk management techniques for managing those risks effectively.
5. Analyze financial measures for the projected future industry leader. (15% of the
project grade)
It is expected that you will discuss why you selected the measures used, interpret the
data, and explain what this information suggests about the company’s financial situation
and future financing needs.
Choose two or more measures from the list:
 Each company’s capital structure
 Cost of capital
 CAPM,
 cash flows,
 value of common stock
 MVA.
6. Project the future stock price of the company you chose as the projected future industry
leader in light of your review and analysis. (15% of the project grade)
Based on your findings and estimations in Stage 1 and Stage 2 of the project, forecast the future
stock price of the company you have selected as an industry leader and include a discussion of any
important changes that may take place in terms of the potential growth of the market, impact on the
availability and cost of capital and any basic resources the company will need to succeed.
7. Reflection – the student should write a paragraph in their own words reflecting on
specifically what they learned from the assignment and how they think they could apply
what they learned in the workplace. (5% of the project grade)
Your research should include a survey of business periodicals, industry data from established
sources, analyst reports, news articles, and journals as appropriate.
Your paper should be supported by spreadsheets, graphs, and tables. All tables and graphs
should have the numbering system, like “Table 1...” the title, and foot/end note to
reference the data.
The Stage 2 Competitor Analysis and Projected Future Industry Leader Selection should be
about 7-8 pages in length (more is OK!) with a minimum of 3 to 4 references and no more than 3
attachments. Written projects must be:
1. typed, double-spaced, in 12-point Times New Roman or Arial font, with margins no
wider than one inch
2. have footnotes or endnotes, with correct citations
3. have a bibliography of sources used
4. include, for each entry, the author, title, city and state of publisher, publisher's name,
year, and page numbers
5. prepared using word processing software (Microsoft Word preferred), in a manner similar
to the preparation of a written assignment for classroom submission
For APA formatting assistance please see below for online tutorials.
Please note that starting from the Fall 2020 semester the UMGC moved to the 7th Edition
of the APA Style. The links to the 7th Edition of the APA Style methodology are posted in
Content – Course Resources – Writing Resources.
Submit your completed work to the Final Project, Stage 2 Assignment Folder.
PRESENTATION OF PAPER AND WRITING (15%) of the project grade):
-Organization, Format and Presentation of Paper including the Title page, Introduction, Body,
and Summary. Each section of the paper must begin with sub-headings. Please use the sub-
headings included in the assignment (4% of the project grade)
Use of Tables, Figures and Other Graphics to Summarize and Support Analysis Presented in the
Paper (3% of the project grade)
Logical and Smooth Flowing Transitions and Relationships among Sections of the Written
Report (3% of the project grade)
Research Sources and Significance of Research Information and Data, Use of APA Citation
Methodology (5% of the project grade)