Analyze the financial health of a public company by looking at its Form 10-K. You will be gathering information from the 10-K for a base company(choose before starting)and two of its competitors, performing horizontal analysis, and then discussing your findings to determine the health of the chosen company relative to various factors as well as relative to the competitors.

The companies you will analyze are: Amazon (Ticker: AMZN)Target (Ticker: TGT)Walmart (Ticker: WMT)

For the most recent 10-K filing: go to www.sec.gov; click on “Filings,” then “Company Filing Search,” and then start typing the name of the company in the “Search SEC .gov” box. Scroll down until you reach the most recent 10-K for the most current fiscal year ended; it may say 10-K/A with the “A” standing for amended(pick amended if it’s an option). Next, you can either click on “Documents” or “Interactive Data. Click on “Documents” so you will gain access to the entire 10-K.The 10-K can be overwhelming for many students, but I want you to look through it(see below for where to focus most of your time); you will not understand some of the technical accounting language, but you will understand the most important information. Understanding the 10-K is vital for any business student to be successful in their career.

BEFORE tackling reading the 10-Ks, please do the following FOR EACH COMPANY using the financial statements: Perform a horizontal analysis of the income statement AND balance sheet for the current fiscal year and last year. Use a spreadsheet software like Microsoft Excel/Google Sheets to make this much faster.

AFTER completing all the required calculations, read through the current 10-K for EACH COMPANY to find some answers to WHY the financial numbers and fluctuations are what they are. Skim through items 1-6 of the 10-K to get some background information. Then carefully read Item 7, the Management Discussion and Analysis; it has tons of information to explain various parts of the income statement results. The fiscal year highlights tell you the current fiscal year story the company is telling. The Notes to the Financial Statements (right after the financial statements) have even more information on the income statement items, as well as a lot of information on the balance sheet items. The key is to explain the significant items and the significant fluctuations. You may find that in some places doing targeted vertical analysis may aid your explanation. Please answer the following questions (number them but don’t rewrite the question):

1.How have the sales changed by segment? What is causing the change? How does that affect your determination of their current and future financial health?

2.What can you conclude about the company’s gross margin/profit and gross margin/profit% over the years and why?

3.What can you conclude about the company’s operating expenses and why? What are some positives and what might concern you and why?

4.What did you learn about how their liquidity and capital resources affect current and future years performance? What does their analysis on cash flow tell you?

5.What did you learn about their assets and current liabilities? What can you say about what caused significant changes? What is good and what is concerning?

AFTER the above analysis is completed and compiled for your base company and two competitors, you need to write a conclusive analysis comparing the base company to its competitors. You should compare and contrast the analysis that you completed for the horizontal analysis and the 5 items you analyzed.

Answer rating: 100% (QA)

Answers 1 Based on the sales information provided in the 10K filings it appears that Amazons sales have grown significantly over the past few years while Targets and Walmarts sales have been relativel... View the full answer