ANNUAL REPORT 2014 Linamar Corporation TABLE OF CONTENTS 1. Letter to Our Shareholders 2. Management Discussion amp;amp; Analysis 11 3. Consolidated…
In this analysis, you will discuss the financial health of two companies (ZCL and Linamar) with the ultimate goal of recommending one of the companies to an investor. Your paper should consist of the following sections: introduction, company overview, vertical and horizontal analysis, ratio analysis, final recommendation, and conclusions. You may use scholarly resources and your textbook as references.Here is a breakdown of the sections: Company Overview Provide a brief overview of the two companies (two to three paragraphs at most) and indicate their industry. What are the main products or services? Who are their competitors? Vertical and Horizontal Analysis of Income Statement and Balance SheetPrepare a two-year vertical and horizontal analysis of the income statement and balance sheet of the two companies. Discuss the importance and meaning of horizontal analysis. Discuss both the positive and negative trends. Ratio AnalysisCalculate the current ratio, quick ratio, net working capital, debt-to equity ratio, times-interest earned, financial leverage, asset turnover, Receivables Turnover, Average collection period, Inventory Turnover, Average days in Inventory, profit margin, return on assets (ROA) and return on equity (ROE) for 2014. Discuss and interpret the ratios that you calculated and compare the liquidity, efficiency and productivity of PPE and Total assets, receivables and inventory management and solvency of the two companies. Discuss any potential issues based on your calculations of the ratios for the two companies. Use the Dupont framework to analyze any difference in the ROE of the two companies. Are there any factors that could be erroneously influencing the results of the ratios? RecommendationBased on your analysis, which of the two companies would you recommend as an investment to a prospective investor? What strengths do you see? What risks do you see? You must provide justification for your recommendation.
1. Must begin with an introductory paragraph that has a succinct thesis statement.2. Must address the topic of the paper with critical thought.3. Must end with a conclusion that reaffirms your thesis.