The objective of this assignment is to assess your group ability to evaluate and to compare the operation and performance of two companies (Peer Group Analysis) that are competitor to each other using Fundamental Analysis technique (Financial Ratios).
Your group need to choose two companies and the two companies have to be Australian public listed companies, operating under the same industry, targeting the same consumers, producing similar products or services and similar in size for example: BHP Billiton and Rio Tinto (mining industry in Australia)
Please note: each group can only choose 2 companies, and once those two companies are chosen, the other group cannot choose the same companies (in other words, the later group has to choose another two companies that haven’t been chosen by others).
The rule is first come first serve, it means let your lecturer knows asap which companies your group want to discuss and your lecturer can check whether your chosen companies are still available or not.
You need to extract the latest year financial statements (Income statement, balance sheet etc.) of your chosen companies from online source. such as ASX website (www.asx.com.au)
Each company will be evaluated and compared based on the five aspects to determine which company is better fundamentally.
The five (5) aspects:
- – Short term solvency (Liquidity ratios)
- – Long term solvency (Financial Leverage ratios)
- – Asset utilization (efficiency or turnover ratios)
- – Profitability ratios
- – Market value ratiosYou need to present a well-structured Report using appropriate style and language Scenario:You’re an Investment Manager of a large corporation based in Australia. There’s one big institutional investor from overseas is interested in investing in the Australian market, however the investor only interested in the blue chip companies. You’ve been asked to choose two large companies operating under the same industry in Australia (the industry you think will have the most promising future for investment) then evaluate and compare them. finally make a recommendation through your Report to the investor which one is more superior fundamentally.
Structure of the Report:
- Table of Content
- Body (In text citation: paraphrased or quotation to support your arguments)
- Reference lists (Harvard Rules techniques)
- The quality of your academic writing skills will also greatly influence your mark; therefore, you must follow all the rules.
- No in text citation in the body will be considered not an academic writing.
- No reference lists part will be considered not an academic writing as well.
- Minimum reference lists = 10 and must be from trustworthy sources
- Minimum words limit: 3500 words
- You’re required to submit the assignment on Blackboard with the maximum similarity (plagiarism check) not exceeding 30%.
- Deduction will apply for late submission (due date = week 10)
- Font: Times New Roman, Size: 12, line spacing: 1.5
- Holmes Institute front page cover sheet is needed and you have to write down your full name, student ID, subject code, subject name, and lastly your Lecturer’s name
- Always keep an electronic copy of your assignment until you have received the final grade for your subject or unit.
– Presentation and writing style = /3
– Introduction = /2
- – Evidence of research = /3
- – Quality of the analysis = /7
- – Conclusion and Recommendation = /3
- – Referencing = /2
Total = /20
The quality of your analysis is more important than the quantity of the ratios. Meaning, your assignment mark will be greatly influenced by your interpretation and understanding of the numbers rather than the calculation itself.