Excel Spreadsheet and Written Analysis – Chosen Company Ratio Analysis
Now it is time to use the financial model that you have been creating over the past 4 modules/weeks. First, as per textbook instructions, load your company’s financial statements into your Excel financial model. If you constructed your model correctly, it will produce a ratio analysis table for your company. Next, find and read 3 articles (or guides) that describe how to conduct a ratio analysis of a company. Finally, using these articles and chapter 13 in your textbook, write a ratio analysis report for your company. Your report must include the ratio printout from your financial model. Evaluate all ratios and/or ratio trends that you believe are interesting or relevant. Your paper must be at least 1000 words, using proper current APA guidelines. Make sure to properly reference and cite your sources.
Company chosen is Sherwin-williams, Analysis for the year 2016, 2017, 2018 and 2019
The textbook is Building Financial Models third Edition by John S. Tjia. / If you want me to upload the chapter 13 & 14 for you please let me know so the solution can reflect what is in the textbook.
Excel Spreadsheet and Written Analysis – Chosen Company Financial Forecast
Similar to last module/week’s assignment, use your Excel financial model to create a financial forecast for your company. First, use the ratio analysis you conducted (and any other information you can find about analyst’s projections for the firm) to create all assumptions required for your forecasting model. Generate a written list of all of your assumptions, with a reason or explanation for each assumption. For example, if you assume that sales will grow at 12 percent for the next year, provide specific justification for this assumption. Do this for every assumption that you use to create your forecasts. You should have assumptions for every account listed in Chapter 14 of your textbook (if an account is not valid, you can ignore that item, but there should be very few that are not valid).
Your report must include the forecasting printout from your financial model. Finally, evaluate the implications of your forecasts for your company. Do your forecasts indicate strength? Weakness? Why? Your paper must be at least 1000 words in length using proper current APA guidelines. Make sure to properly reference and cite your 3 sources.
Excel Spreadsheet and Written Analysis – Chosen Company Valuation
Using your Excel financial model, create a valuation estimate for your company. Your estimate will incorporate the following:
· The weighted average cost of capital
· The free cash flows
· The terminal value
· The enterprise value
· The equity value
Your financial model, if properly constructed, will create all of these items except for the weighted average cost of capital. Find and read at least 3 scholarly articles about the weighted average cost of capital (WACC). In Part I of your report, write a summary of the articles that you read.
To create WACC for your model, you must find values for all parts of the WACC equation (for your company). In Part II of your report, list the values you believe are appropriate for the WACC equation for your company and provide specific justification for each variable estimate.
Next, use your WACC assumptions within your financial model to create a valuation estimate. A printout of your valuation estimate will be Part III of your report. Finally, in Part IV, compare your estimate to the actual enterprise value (i.e., debt value plus equity value) of the company. Explain (as best you can) the difference between your forecasted valuation and the actual value of the company, offering some possible explanations for the deviation.
Your paper should be at least 1000 words in length using proper current APA guidelines. Make sure to properly reference and cite your sources.
Overview of Ratio Analysis
19 to 20 points
Student provides, as an introduction to the paper, a complete and convincing description/argument for the how and why of ratio analysis.
Excel Spreadsheet Ratio Printout
47 to 50 points
Spreadsheet table(s) is/are correct, professionally presented, with proper titles, headings, etc.
Company Analysis Example: Ratio
33 to 35 points
Student clearly and accurately identifies and evaluates major ratio trends or outliers displayed in the Excel spreadsheet table(s).
Word Limit Met
14 to 15 points
A minimum of 1000 words, excluding title page and references page.
Proper Spelling, Grammar, APA
14 to 15 points
There were no more than 2 spelling, grammar, or APA errors.
Number of Sources Used
14 to 15 points
Student used at least 3 professional/scholarly references in each part, in addition to the course textbooks and the Bible.