Managerial Finance
In Module 8, you will submit your Final Paper:
For your final project you will write a short concise stock recommendation report for a firm in which you
would recommend as a buy. You are correct that this is not an investments class but as you take a look
at the examples provided you will see the application of various topics studied in this course. You will
see ratios discussed, discounted cash flow valuation applied, growth opportunities analyzed and
ultimately whether or not the investment opportunity is one that should be pursued. This investment
opportunity and determining the risk, reward and valuation all are discussed throughout this course.
Your paper will be in the range of 2 to 3 pages formatted similarly to the examples provided. References
must be included and those should be referenced using the latest APA guidelines.
The examples are not all the same but there are some common themes. Most include a brief discussion
of the industry and industry outlook and where the firm being analyzed stands and performs in the
industry. You will not that ratio analysis is often used but the ratios may vary by industry. In other
words the key ratios used to analyze firms in industry “A” are not the same ratios used to analyze firms
in industry “B”.
Valuation is often considered using more than one method. Discounted cash flows may be used in
conjunction with an appropriate ratio (again the ratio likely varies across industry). How does the
current share price compare to what your analysis values the stock?
Risk, growth potential, payout policy, and other factors are other items that may be discussed in the
reports. These all play a role in analyzing a firm and may signal management’s belief on future value of
the firm. Those may be items you will want to discuss in your report. Do not forget the threats that the
firm faces as well. There is no firm that does not face competition. Those threats should be considered.
You have been provided with a list of supplemental sources in the course content. This includes sources
available through the Hunt Library one of which is S&P Net Advantage. S&P Net Advantage provides
some very useful industry reports which may help you determine how firms in a particular industry are
analyzed. There are other sources you can feel free to use as well.
The big question is why buy the stock you have selected. You do not have a lot of space to complete this
project. You will need to be concise and to the point in your writing. Provide tables as you see fit and
other graphs/charts that support you position. Note, the examples may include recommendations to
buy, sell, or hold. Your report must be for an opportunity you believe is a buy.
Note on the examples: Value Line has a very unique format. The data is there is some discussion of key
factors. The other example(s) better reflect what your submission should be similar to.
When submitting your Word document using the following naming convention:
lastname_firstinitial_MBAA518_firmticker_final_project.
(example: Jones_M_MBAA518_firmticker_final_project.docx)
Font size should be no smaller than 10 nor larger than 12 point font. Headings should be bold (not a
larger font). Again, be concise; you do not have room for a lot of “fluff.”
MBAA 518 – Managerial Finance
Examples can be found at these links:
ValueLine.MSFT
Mergent.WebReports.MSFT
Please note that these links are through the ERAU Hunt Library, so you may need to log in with your
ERNIE username and password.