Gaming Company Report
This assignment will reinforce your ability to understand the importance of cash flows, forecasting, and discounted cash flow analysis using cost of capital.
Choose a PUBLIC company (you may NOT choose Disney!) The company You will Analyze is Activision Blizzard
Use the Disney template
Analyze the last few years (3 years minimum) in terms of the trends. Download the 3 financial statements (income statement, balance sheet, cash flow) data from MorningStar using Export button.
http://financials.morningstar.com/income-statement/is.html?t=KO®ion=usa&culture=en-US
Replace KO with your stock symbol
Fill out the provided DCF template file with historical numbers for the income statement, balance sheet, depreciation, and capex using Morningstar. Review Finbox.com for hints.
Forecast the ratios needed to do a Discounted Cash Flow analysis:
Sales, EBIT, Depr, Net Working Capital, Capex. Explain your forecasts.
Calculate the Free Cash Flows to the Firm, building a discounted cash flow model with appropriate cost of capital to arrive at a current stock price.
In a paper with a max of 1200 words, explain, analyze and provide your own views of the company fundamentals using your own research, SWOT or Porter Analysis. Analyze the historical trends and which financial ratios are most important or are changing. Explain how you arrived at your forecasts of sales and ratios.
Are your forecast sales rising/falling and why?
Do you have expenses rising/falling and why?
Does the firm need more/less working capital (inventory, etc)?
Is the firm spending more/less on capital expenditures?
How is the competitive environment vs your company?
Explain if the stock is over or undervalued, and if the stock is a Buy, Hold, or Sell.
Create 6 slides
Helpful hints:
Read the latest Annual (10K) or Quarterly Report (10Q),
Research Porter/SWOT examples
Listen to the latest quarterly conference call, Earningscast.com
Finbox, Morningstar, Yahoo Finance, CNBC to do analysis
In sum, You need to fill out the template with data. Writing a 4-5 page paper and the 6 slides. Be sure to follow the template exactly and the guideliness.
