Company analysis: Business Analysis Report Supervision

 

Agenda

  • Contact details
  • Learning objectives
  • Supervisor role
  • Timeline
  • Resources
  • Some tips
  • Q&A

Your task

  • The study will comprise a comparative appraisal of thefinancial position, performance, cash flows, and valuation of two companies in the same sector.
  • When analysing the three main financial statement (performance, position, and cash flows) ratio analysis, vertical (i.e. columnar) analysis, horizontal analysis, and trend analysis should all be used.
  • The appraisal includes a SWOT Analysis for each of the two companies and a valuation of the company’s future position.
  • Prepare a list of financial indicators you like to use in the report for analysis. Check in Orbis: they categorise ratios into different performance metrics.

 

Your Task

  • The principal sources used will be the published AnnualReports of the two companies.
  • You are required to analyse 3-5 fiscal years, a longer period would be expected for trend analysis.

Your Task

  • The study shall focus on comparing two companies, eitherlisted in the in EU (including the UK), both of which are listed in the same sector !
  • It must be a multi-year comparative study and mustinclude financial analysis of the two companies.
  • Get the data ready for analysis ASAP! Prepare an excelfile for all the ratio analyses.
  • Keep all of your documents safe, possibly save them in two different places e.g., in the cloud drives.

Project requirement outline

 The study will comprise a comparative appraisal of the financial position, performance, cash flows, and valuation of two companies in the same sector. The appraisal includes a SWOT analysis for each of the two companies. The principal sources used will be the published Annual Reports of the two companies and will include horizontal and vertical analysis, trend analysis and ratio analysis, with reference also to market forecasts and corporate valuation.

 As part of your report, you will critically survey the literature and online resources, and employ this knowledge to guide you in drawing conclusions regarding the financial position, performance, cash flows, and valuation of comparable firms and their respective strengths, weaknesses, opportunities and threats.

 

Learning objectives

  • Demonstrate a critical awareness of business analysis and critically appraise and evaluate research problems in the field.
  • Critically survey and analyse relevant theories, models and evidence and examine their explanatory contribution with respect to the cases under investigation.
  • Select appropriate financial and business data, and generate a robust financial statement analysis of competing firms in order to account for market values and/or market forecasts.
  • Effectively plan, organise and self-manage the research project.

Learning objectives

  • The work must go beyond description to provide critical analysis, synthesis, interpretation, and application.

The Structure of Your Report

  • The report should be of 8,500 words. The Reference list and Appendix are not included in the word count. Everything else is included.

The report should be of the same overall structure you would expect in any essay or dissertation, including:

  • Abstract (of a maximum of 250 words)
  • Table of Contents list and lists of figures and tables.
  • Introduction
  • Literature Review (of at least 30 items)
  • Study (the Study chapter should be the longest)
  • Discussion (and Conclusion or)
  • Conclusion

 

Introduction

  • What you include in each chapter is really down to you.Ideally, your introduction must clarify what your research is about, the aim and objectives
  • you should introduce the companies and their industry in the Introduction and expand on those details both in the Literature Review and more so in the Study Chapter.
  • The 2 companies and their industry should be describedin the Introduction. If that description is brief, a fuller description should be given at the beginning of the Study.

Introduction

  • A brief summary of the findings should be included in the end of the introduction
  • Ideally, research question(s) should be introduced somewhere in the Introduction Chapter or the Literature review and repeated in the Study.
  • Provide a brief discussion outlining the chapters that youhave discussed in the remaining of the report.

The literature review

  • The Literature review would be expected to includematerial on SWOT analysis, financial analysis, financial valuation, the industry in which the companies operate, the country (ies) in which the companies are operating and the two companies.
  • Sources could include articles in academic journals, books, chapters in books, professional websites, corporate communications, newspapers, other media.
  • Appropriate use of relevant theory will be rewarded.
  • You must      avoid   non-reviewed      sources      such     as

“Wikipedia” or “Investopedia” !

  • Harvard referencing must be used ! Reference list (must have at least 30 sources in the Reference list

The study

  • The Study can be done either as a combined analysis ofboth companies or company by company. SWOT analysis should be included in the Study.
  • SWOT analysis is a compulsory part of the report. They can use other models/approaches as well, but they must include SWOT.
  • You can either analyse both companies at the same time,or you can conduct a sub-section study for each company then compare them afterwards.
  • It is up to you to choose, but you must conduct your studyin a coherent way !

Discussion

  • The Discussion should discuss what was found in the Study,highlighting the differences between the companies on all aspects of the study with an overall viewpoint on each company from the perspective of the SWOT analysis.
  • The current share price of each company must be mentioned in your Report, along with relevant ratios and some discussion of what those ratios indicate.
  • If this is done in the Study section of the report, the findings relating to this would be expected to be referred to in the Discussion section and in the Conclusion section.
  • Do NOT introduce this material for the first time in the Conclusion.

The conclusion

  • The Conclusion should start with a brief summary of whatwas done during this project. Limitations in the study should be recognised. The Conclusion should summarise the findings and then express some concluding thoughts on those findings. The emphasis in this final part of the Conclusion should be on the two companies, one versus the other.
  • The Conclusion must end with recommendations for different stakeholders to the company e.g., Investors, Lenders, and Other creditors.
  • Limitations in the study should be recognised in the

Conclusion.

 

Supervisor role

  • Primary role of the supervisor is to guide and support students with research methods, not the research itself.
  • The supervisor is not expected to teach any new content.
  • Supervisors need to be available for at least one face to face meeting (at a time that is convenient, not on demand), and throughout the summer via email.

Available resources at Sussex

Sussex library has an extensive resources that can help you improve this report.

Check the Nexis database for SWOT analysis!

Check Orbis (any companies in the World) or FAME (UK companies) databases for extracting financial data for further analyses.

Nexis

  • Step 1. Visit Sussex Library. Select Nexis.
  • Step 2. It should ask you to login – you all have access to this database.
  • Step 3. Once you are on the Nexis, click on

“Companies”

  • Step 4. Type the name of your company. Provide a search tip eg., “SWOT”, so you will get a specific search result. Explore this research tool to improve your analysis.

Orbis

  • Step 1. Visit Sussex Library. Select Orbis/Fame.
  • Step 2. It should ask you to login – you all have access to this database.
  • Step 3. Once you are on the Orbis/Fame, type the name of your company.
  • Step 4. You can export data in Excel spreadsheet.

There are many ways you can export data from Orbis. Explore more. Here is a list of YouTube videos that explain how to use Orbis. Orbis and Fame use same data structure. Therefore, exporting procedure is identical for both.

 

Resources

  • 874N1 Canvas site (Lecture slides, FAQ file, sample projects)
  • Make sure you read through all the materials and follow the instructions!
  • Materials from relevant modules
  • Sussex Library website (journal articles, textbooks)
  • Google scholar
  • Databases on the library website (Business, Management, and

Economic database)

Presentation

  • As you will end up with many tables in the report, use proper numbering throughout the report so that your report looks professional. For example, if you like to add few tables in Section 3 and if you have 10 different tables or graphs. Number them as follows:
  • Table 3.1, Table 3.2, Table 3.3 and so on…
  • Always use self-explanatory caption for your tables or graphs. For instance,
  • Table 3.1: Comparing ROA/ROE of Next and M&S for the period 2005-2019

Note that this presentation style is just a suggestion, use your creativity to present as 21 you deem fit.

Supervisor role

  • All research is expected to use secondary data. As such, formal school level ethical reviews are not required (just need to finish the checklist).
  • Supervisors are expected to review draft chapters / sections, but only once. Students should not expect feedback on the same section over and over again.
  • Submission of a complete final draft for review is discouraged, any feedback given on complete work should be focussed on structure, not content.

Structure/Organisation

The project should be presented with a clear aim and objectives. It must have a logical sequence of chapters. Your project will normally have the following format:

 Title page

 Contents list (with chapter headings and page numbers)

 Introduction

 Current knowledge and views on relevant aspects of financial performance,

SWOT or accounting theories (literature review)

 Company and sector overview

 Presentation and analysis of data and results

 Discussion and Evaluation

 Summary and conclusions

 References (in alphabetical order of author using the Harvard Referencing System)

 Appendices (for example: extracts of financial statements and your ratio calculations)

Some tips

  • (a) Avoid story-telling.
  • (b) Your project aim and objectives are key statements of what your project is trying to do. You need to keep reminding yourself of them to ensure you maintain your focus on what is relevant.
  • (c) Keep reviewing your work-in-progress. You may need to re-write sections and you may need to re-word your aims and objectives (or research questions) in light of your research and findings.
  • (d) Use charts and diagrams to present data in a useful way. Diagrams make your project more interesting for the reader but avoid too many diagrams especially if the diagram or chart conveys very little information.

 

Some tips

  • (e) The purpose of your analysis is to produce the evidence upon which you are able to draw your conclusions with regard to the project aim and objectives. Beware opinions and conclusions unsupported by clear evidence.
  • (f) Keep all your notes and other evidence (electronic files/folders). Make sure you keep a note of your sources/references as you go along (it is much more difficult to find these weeks or months later).
  • (g) Plagiarism is the theft of other people’s words. It is an offence of which examiners always take a severe view, as they are bound to do by University rules and conventions.

Some tips

  • (h) Check the typescript. You are responsible for the accuracy of the final text. Leave plenty of time for careful checking. Don’t leave the checking until the last minute.
  • (i) Always keep a spare copy of your project and a spare hard copy. You should regularly back up all work done in multiple ways e.g. ndrive, USB stick, e-mail attachment.
  • (j) Keep working to your plan on the topic in a regular manner. You will find that the time passes very quickly. Manage your time by setting your own timeline and targets, reviewing this periodically to ensure a successful completion of your project.
  • Question? 