QUESTION 1

Case Background

Financial statement analysis is everybodys business. Its importance cut across many disciplines in both academia and industry. Showing a good understanding and interpreting financial statement has therefore become relevant in the study of Business Finance.

Your task under this section is to analyze the financial statements of two selected firms and write a report on the performance of the firms to be presented to potential investors using the guidelines below.

Data Collection

1. Follow the link provided to assess financial statement of two firms: Armcor PLC and Sealed Air PLC listed on the S&P 500. The financial statements comprise of separate Balance Sheet and Income Statement for the two companies.

https://drive.google.com/open?id=16VDq53Q3vgkubKUcO7JyI96Vxsw22Vul

2. You can also visit Yahoo! Finance at http://finance.yahoo.com/ to read more about the two companies

Analysis

1. Write a short description of Armcor PLC main line of business only. Be sure to include the following details

a. The stocks most recent price, trade date, and trade time.

b. A description of the highest and lowest prices the stock has reached in the past year.

c. The companys market capitalization, price-earnings (P/E) ratio, and its price-to-book ratio. Describe what each ratio means.

2. Use the balance sheet and income statement data you gathered to complete this section for both Armcor PLC and Sealed Air PLC.

a. Complete a simple financial statement analysis of the two companies (calculating and discussing at least two ratios under each Liquidity, Profitability, Leverage, Market/Investment and Efficiency ratios).

b. Discussing by comparing the two companies results. Discuss the changes in relation to the ratio categories discussed.

The table below suggest possible financial ratios that can be calculated. Students can select two ratios under each heading.

LIQUIDITY RATIO	Armcor PLC	Sealed Air PLC
Cash Ratio
Current Ratio
Acid T est Ratio
LEVERAGE RATIO
Total Debt ratio
Debt/Equity Ratio
Debt/Equity Ratio (approximated)
PROFITABILITY
Gross profit margin
Net Profit Margin
Operating Income margin
EFFICIENCY RATIO
Inventory turnover Period
Trade Receivable period
Trade Payable Period
MARKET/INVESTMENT RATIO
EPS
P/E ratio
Interest cover ratio
Dividend Cover ratio