The completed report should include for Lockheed Martin 2019:

An introduction to the company, including background information.

A financial statement review.

Pro Forma financial statements (Balance Sheet and Income Statement) for the next two fiscal years, assuming a 10% growth rate in sales and Cost of Goods Sold (COGS) for each of the next two years.

A ratio analysis for the last fiscal year using at least two ratios from each of the following categories:

oLiquidity

oFinancial leverage

oAsset management

oProfitability

oMarket value

Calculate Return on Equity (ROE) using the DuPont system.

Assess management performance by calculating Economic Value Added (EVA).

Evaluate the soundness of the company's financial policies (e.g. capital structure, debt, leverage, dividend policy, etc.) based on the material covered during class.

A synopsis of your findings, including your recommendations and rationale for whether or not to purchase stock from this company.

Requirements:

Please use these titles, and be very, very organized:

Title Page

Introduction

Financial Statements (notice the "s") review

Proforma: (add an extra column to justify your entry(same, or 10% increase, or paid off, etc.)-calculate using Excel)

Do exactly like figure 5.10, and 5.12. (notice the extra column titled "Explanation")

Ratio analysis 10 ratios - (calculate using Excel, You must show your calculations.)

ROE analysis. (You can use Excel to do the calculations (you must show the calculation))

EVA: (you will need to calculateWACCto be able to calculate EVA)

Steps to calculate EVA:

This isNOTan essay about EVA. (please don't write an essay and expect a grade)

pleasecalculateEVA for the most recent year (not for pro forma). Assume that the book depreciation and economic depreciation are the same.

Calculate Net Operating Profits After Tax (NOPAT)

Calculate Invested Capital

That is to calculate:

Total debt

Adjusted Equity = shareholders' equity + Net Deferred tax + Non-controlling interest + other accumulated comprehensive income (loss) {the last item is negative, but should be added in this equation}

Calculate Invested capital =item a above + item b above

Calculate market value of equity (be sure to add the date)

Calculate CAPM (Make a valid assumption for the cost of debt using actual data)

Calculate effective debt interest rate = Interest Expenses / total debt

Calculate WACC

Calculate EVA and explain its importance

The final step is to analyze the result.

Company evaluation (At least do capital structure, debt, leverage, and the dividend policy)

Summary and rational to purchase the stock

Reference page