Objective: Engage students in practical financial analysis by standardizing financial statements and performing comparative ratio analysis using Bloomberg Terminal, fostering a deeper understanding of financial metrics within an industry context.
Company name: MCHP US EQUITY MICROCHIP TECHNOLOGY INC ( use the latest fiscal year)
Assignment Instructions:
Company Selection
Each student will find their company’s closest peer (RV function). This selection process encourages initial exploration and sets the stage for targeted financial analysis.
Data Collection
Utilize Bloomberg Terminal to gather both companies’ most recent financial statements (income statements, balance sheets, and cash flow statements). This task integrates theoretical learning with practical data retrieval skills. (Get screenshots of all financial statements from Bloomberg terminal)
Analysis Tasks:
Standardization of Financial Statements
Students will standardize the financial statements of their assigned and Peer companies to ensure comparability. This process involves adjusting for size, market conditions, and other industry-specific factors.
Reflect on the process of standardization and its importance in ensuring fair comparisons, enhancing students’ awareness of discrepancies that can arise from raw financial data.
Ratio AnalysisCompute critical financial ratios such as liquidity, profitability, and leverage ratios for both companies.
Create visual representations (charts or graphs) of these ratios to illustrate comparisons and trends over time (Three years).
Provide creative interpretation of these ratios, discussing what they reveal about each company’s financial health and operational efficiency.
DeliverablePrepare a detailed three-page report containing: use excel for financial statements and graphs (comparing the peer companies as well).
A section on the methodology used for standardizing financial statements. (Excel)
Data tables and graphs showcasing the computed financial ratios and their comparisons. (Excel)
A narrative analysis discussing the implications of these ratios in terms of industry standards, financial health, and potential investment opportunities. (Explain in word document )
Students are encouraged to approach the layout and presentation of their findings with innovation, perhaps integrating digital tools to enhance the visual appeal and readability of the report.
Requirements: | .doc file