Equity Analyst Project

 

Franklin University

 

MBA 737

 

Equity Analyst Project                                                             (Version 5.2)

 

The Equity Analyst Project involves a total of three assignments:  

 

1.      Team Analysis of Select Industry Groups

 

 

 

Team Analysis of Select Industry Groups

 

This analysis is a team assignment that requires your team to analyze a select group of alternative industries to determine which is most likely to perform best in terms of growth and earnings over the next 12 months. Your instructor will create your teams, ideally based on similar views about the near-term prospects for the U.S. economy expressed in the Individual Asset Allocation Exercise. 

 

To guide this second stage analysis, you are asked to rely on the North American Industry Groups database available at Yahoo! Finance at Yahoo! Finance. The system is comprised of 9 business sectors:

 

·                     Basic Materials:

 

·                     Conglomerates

 

·                     Consumer Goods:

 

·                     Financial

 

·                     Healthcare

 

·                     Industrial Goods

 

·                     Services ( this is the assigned business sector selected)

 

·                     Technology

 

·                     Utilities

 

To simplify the exercise, the 215 industry groups within these 9 sectors have been reduced to a more analytically manageable list that includes only those industries at Yahoo! Finance with public firms totaling no less than 5 and no more than 15 companies. This list is attached as an appendix to this document. 

 

 

 

To access more details on these groups go to  http://biz.yahoo.com/ic/ind_index.html and click on any of the industries to go to each industry’s “Industry Center” page. Additional useful information is available via the link to “Industry Browser” on the left. Also, on each industry’s summary page click on “Company Index” and then on “Public” on the subsequent page next to “View:” to get the list of public companies in this industry. Our focus is on publicly listed companies in which we might ultimately invest. The list of public companies is provided alphabetically. Following each name is the company’s ticker symbol in brackets.  See http://www.investopedia.com/terms/s/stocksymbol.asp or http://www.investorwords.com/4968/ticker_symbol.html  for brief definitions of stock/ticker symbols.

 

 

 

Please note that on occasion the ticker symbol may also be followed by other letters, such as PK or OB (see http://www.investopedia.com/ask/answers/04/022004.asp

 

 or http://www.investopedia.com/ask/answers/120.asp for explanations). It is recommended that we ignore stocks so designated in these exercises.

 

 

 

The goal of this second stage in our equity analyst project is to select one industry out of this list of 24 whose performance prospects you determine are best over the next year. Here are some factors to consider when comparing industry groups:[1]

 

• Degree of Competition in the Industry
• Supply/Demand Dynamics for the Industry’s Products  (Only write on this topic)
• Industry Cost Structure
• Degree of Government Regulation-Favorable or Not 
• Exposure to the Business Cycle
• Relative Financial Norms and Standards

 

 

 

Write a 2 page paper on Supply/Demand Dynamics on the AUTO DEALERSHIP industry, in APA format.