Corporate Valuation

User Generated

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Business Finance

Description

The purpose of this assignment is to allow students the opportunity to research a Fortune 500 company stock using the popular online research tool Yahoo Finance. The tool allows the student to review analyst reports and other key financial information necessary to evaluate the stock value and make an educated decision on whether to invest.

Assignment Steps

Resources: Yahoo Finance

Select a Fortune 500 Company from one of the following industries:

  • Pharmaceutical
  • Energy
  • Retail
  • Automotive
  • Computer Hardware
  • Manufacturing
  • Mining

Access Yahoo Finance and enter the company name.

Review the financial information and statistics provided for the stock you selected and answer the following:

  • What is the ticker symbol of the company you chose?
  • What is the Current Stock Price?
  • What is the Market Cap for the stock you chose?
  • What is the Price to Earnings Ratio?
  • What is the Dividend and Yield?
  • What is the Enterprise Value?
  • What is the Beta?
  • Was there a Stock Split, and if so, when?
  • What was the closing stock price for the last 5 days?
  • What was the 52 Week High for this stock?
  • What is the Book Value per Share?
  • What type of rating are analysts recommending (i.e. buy, hold, etc.)?
  • What is the target price analysts are predicting for this stock?
  • What is the analyst's average revenue estimate for next year?
  • What are some of the significant news items and press releases made by the company over the last year?

Explain in 700 words why you would or would not recommend investing in this stock.

  • Describe the relationship between the value of the stock and the price to earnings ratio.
  • What information does the Market Capitalization (Market Cap) and Beta provide to the investor?

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Explanation & Answer

Attached.

Running Head: FORD MOTORS INVESTOR ANALYSIS

Ford Motors Investor Analysis
Student’s Name
Institution of Affiliation
Course
Date

1

FORD MOTORS INVESTOR ANALYSIS

2

Why Investing In This Stock Is Recommended.
Ford motors is an American multinational automotive company trading as F at the NSE.
The current stock price is US$10.99 while the market cap of its stock is 999the Company’s price
earnings ratio is5.78 while the dividend yield is 5.45% (Yahoo Finance, 2018). Its enterprise
value is 12.39 and beta is 0.92 with no stock split. However, its closing stock price in the past
five days is 11.01. The 52-week high value of the company's stock was 10.97 to 11.13 while the
book value per share stands at US$47.460 Billion. The company’s market cap is US$43.667
Billion.
Analysts are recommending that with the prevailing market conditions, it is advisable to
invest in the stock of the company since they are at their lowest level and are expected to rise in
value as the economic condition strengthen. The target price that has been predicted by analysts
for this stock is $11.98 while the average forecast revenue for next year is US$ 157,776,000. The
significant news items and press releases made by the company over the last year is that the
company plans to expand its investment in new SUVs by 2020 (Collings, 2015). With all these
information, it is clear that the stocks of the company are undervalued and is facing less volatility
and risks with high return on investment. Investment in this stock is therefore highly
recommended.

FORD MOTORS INVESTOR ANALYSIS

3

The Relationship between the Value of the Stock and the Price to Earnings Ratio.
The relationship between the value of the company’s stock and its Price Earnings Ratio is the
value that the investor gets to from the price paid to acquire the stock. The EPS of the company
is an illustration of the amount of income that the company generates from trading its stocks. It is
an indicator of the ability of the company to perform beyond its expectation. The P/E ratios are,
therefore, the measure of how attractive the company's stock is to potential investors.
The P/E ratio is a combination of the prices and the earnings attributed to the stock of the
company, thus illustrating the gains that the stocks will give the investors. Besides, it is based on
the forecasted future earnings performance and thus helps in measuring the value of the stock
(Schabacker & Mack, 2015). This is particularly so because the key interest of the investors in
the stock is the return from the investment which is measured in terms of ...


Anonymous
I was having a hard time with this subject, and this was a great help.

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