1. Select a publicly held company Panera Bread 2. Select a benchmark firm to compare your company against. The benchmark firm is typically the largest competitor. Starbucks 3. Obtain the firm’s balance sheet, income statement, and statement of cash flows for the past 5 years. Download or read the firm’s annual report. 4. Go to:http://www.sec.gov/edgar/searchedgar/webusers.htm Research EDGAR’s database for additional SEC report filings: 8-k, 10-Q. 5. The following table is the type of Excel or Word table that should be used to gather and report your ratio and financial performance data. Note the 5 financial diagnostic categories that should be used in your analysis. Financial diagnostic categories Chosen company vs. Benchmark competitor 1.) Liquidity of short-term assets -Current ratio -Cash ratio -Quick ratio -Current ratio -Cash ratio -Quick ratio 2.) Long-term debt-paying ability -Debt ratio -Debt-equity ratio -Times interest earned -Debt ratio -Debt-equity ratio -Times interest earned 3.) Profitability -Net income/sales (profit margin) -Net income/assets (ROA) -Net income/shareholder equity (ROE) -Net income/sales (profit margin) -Net income/assets (ROA) -Net income/shareholder equity (ROE) 4.) Asset utilization/ management efficiency -Total asset turnover -Inventory turnover measures -Accounts receivable turnover -Total asset turnover -Inventory turnover measures -Accounts receivable turnover 5.) Market measures -Price/earnings ratio -Earnings per common share -Dividend payout -Price/earnings ratio -Earnings per common share -Dividend payout Place your ratio calculations in the table for your selected companies—primary company and benchmark competitor. Using 5 diagnostic categories, and 3 ratios to assess each category, results in 15 ratio measures per company that will be compared side by side. 6.) To validate your research, 5 years of data should be analyzed so compute ratios for both selected companies for each of the 5 years. 7.) The financial analysis report must be written properly. They must include a title page, a table of contents, and a reference page. Information sources from the web, etc. must be cited properly, using APA style. This means that every table that you cut and pasted or typed from the web must have a source at the bottom of the table AND that citing must also be included in a reference page at the end of the report. Panera Bread Starbuck
