You will first base your analysis on your company's standardized financial statements from either the Morningstar or Reuters websites and use the average sales and/or average revenue numbers for the upcoming year found in Reuters.com consensus estimate analysis and/or the growth rate that the management may mention in the Management Discussion and Analysis (MD&A) section of the company's most recent annual report.

Apply the modified percentage-of-sales approach to compile your company's upcoming year's pro forma financial statements and to forecast your company's fund shortage for the coming year. Incorporate your company's planned capital expenditures (from its most recent annual report) and justify the assumptions you make in compiling these pro forma financial statements. What is your estimate of your company's common stock price at the end of the coming year using its price-earnings ratio?

Summarize your analysis results in your final report.

The ratio analysis should cover the five (profitability, liquidity, financial leverage, asset management, and market value) areas. It should also analyze the major numbers and ratios from the pro forma financial statements of the company.

Answer rating: 100% (QA)

To begin the analysis we will first review the data from our companys standardized financial statements including average sales and revenue numbers fo... View the full answer