Coursework Assignment (50%)
Submission deadline: 16 November 2017 (Thursday) by 13:00pm via Turnitin.
Required:
You are part of the equity investment advisory group at London Investment partners. Your task is to advise the head of UK equity, on whether it would be wise to invest in a company (of your choice) listed on the London Stock Exchange (FTSE 100 Index). This analysis should be 2,000 words long (± 10%) excluding any figures, graphs and references. Produce a written report taking into account the points listed below.
Criteria for Equity Analysis Written Report
We expect you to use all sources available to you in completing your assignment. You must write a report which addresses the following:
Introduction: Describe the nature of the coursework task and introduce general information about the company, sector, and the issues you are going to analyse. Make clear what the objective(s) of your analysis is (are).
[Short discussion] Max marks: 10
The Outlook for the Global Economy and the Economy in the country (ies) the company operates in: Your analysis should take into account factors such as inflation, unemployment, forecasted GDP growth etc. (only if these factors are relevant).
[Short discussion] Max marks: 10
Sector Outlook: Once you have taken economic considerations into account, you must then focus on the particular sector in question. Your discussion must address issues such as the principal factors which affect performance in this particular sector. [Short discussion] Max marks: 10
Financial Statement Analysis:
This part of your report should feature an analysis of the financial statements of the company. We expect you to apply the techniques you have learnt so far. In particular you are required to carry out a ratio analysis with respect to the following:
• The company’s profitability
• The company’s liquidity
• The company’s efficiency
• Investment ratios
• Financing ratios
• Growth ratios
Please, make sure that you are not merely describing financial information. Give plenty of thought to the contribution that you are making as a financial analyst. In order to submit a good quality work, you must do more than simply identify and describe trends in ratios (current and previous years). Should you opt to use a database for the ratios, you nonetheless need to comprehend how the ratios were calculated. Try to dig into the annual report and especially the notes on the accounts in order to understand the reasons behind the trend you are observing.
[This section makes up the main part of your work] Max marks: 60
Conclusion: There should be a clear link between this section and the main body of your discussion above. Please, make sure that the recommendations correspond to your analysis and are linked to your earlier discussion of macroeconomic, sector and company analysis. Max marks: 10
Useful information sources
• Bloomberg: provides real-time and historical financial market data and economic data, covering all sectors globally. It also features company financials, analytics, news, and customizable charting. The school subscribes to this database and it is available in the Financial Markets Suite (FMS).
• Northcote: Free information on corporate websites includes; annual and interim reports, press releases, summary financial information, results presentations and webcasts, chairman’s statements, price information and broker research (www.northcote.co.uk)
• IMF: The IMF publishes a range of time series data on IMF lending, exchange rates and other economic and financial indicators. Manuals, guides, and other material on statistical practices at the IMF, in member countries, and of the statistical community at large are also available (http://www.imf.org/external/data.htm)
• World Bank: (www.worldbank.org/data )
• Yahoo Finance (UK): very useful in obtaining UK listed company information, sector information, broker forecasts, regulatory news information http://uk.finance.yahoo.com/
