Posted: September 14th, 2017

Financial Analysis

Financial Analysis
report analysing a listed UK company.

The report should provide an analysis of the company’s strategic, financial and stock market performance over the last five years. It should be addressed to a potential investor in the company’s shares and should include your recommendation to that investor as to the desirability of investing (or not) in the short, medium or long-term.

You will be allocated a particular company and the module will provide the tools to enable you to access its published accounts, other financial and strategic data and stock market data. The allocation of assessment companies is carried out randomly. Please note you will NOT be able to select a company of your own choice. In order to satisfactorily complete the assignment, you will need to conduct in depth research into your allocated company, the industry in which it operates and its competitors. You will be given detailed information as to how to conduct this research in lectures and from suggested reading.

The main body of your report should be structured into the following sections:

1. Introduction

This section should provide a brief company history, an outline of the industry and of the company’s position within it.

2. Strategic Analysis

The strategic analysis should contain reference to the broad environment, industry and competitors, and, most importantly, to the company itself. It should include:

A PEST(LE) analysis
An analysis of the industry including a Porter’s Five Forces analysis
An analysis of the company’s strategy with comparisons to its competitors

The analysis could include for example pricing policies, product range, market position, etc with that of its competitors.

3. Financial Statement Analysis

This section should offer an analysis of the company’s financial performance over the last five years. Crucially it should make use of your knowledge of the company’s strategic direction, its industry position and the broad environment. This section should include:

a. Analysis of financial statements, making comparisons with competitors and industry norms.
b. Identification of any new accounting policies/treatments, which may impact on future profitability.
c. Identification of problems of comparison caused by particular accounting policies/treatments.

4. Stock Market Analysis

This section should offer an analysis of the company’s share price performance over the last five years. You will need to use your strategic and financial knowledge of the company as a basis for your analysis.

Analysis of share price performance relative to the industry and the stock market as a whole.
An evaluation of stock market indices (price-earnings ratios, dividend yield, etc.) in comparison with competitors, sector and market averages.

5. Conclusion and Recommendations

The conclusion section should draw together your findings in order to make a recommendation to a potential investor in the company’s shares.

The report should be based on information up to and including Friday 28nd February 2014.

All sources of information should be identified in the report. A full bibliography containing all references (books, newspaper reports with dates, company reports, internet information etc.) must be included with the report. These references will also not count towards the word limit.

Assignments should be a maximum of 6,000 words in length. The word limit does not include the title page, content page, bibliography, appendices, graphs and tables of data contained within the main text and footnotes. There are penalties for exceeding the word limit by more than 10%, please refer to the assessment area in the LU Business School UG VLE organisation for details.

One copy of the assignment must be submitted to the Assignment Submission Box at LUBS Undergraduate Reception and an electronic copy must also be uploaded to the Assessed Assignment Submission area within the module resource on the Blackboard VLE website no later than 12 noon on the deadline date.
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