Question 1 Analyse the company using fundamental analysis by: (a) Providing a short summary of the selected company stock outlining key business and financial performance based on audited financial reports over the last three years (2013, 2014 and 2015). (15 marks) (b) Calculating Key Financial Data over a 3-year period. The financial metrics should include: • Revenue and profit indicators • Shareholder equity and asset indicators • Financial performance indicators on per share basis • Return indicators (20 marks) Question 2 Compute the appropriate cost of capital using CAPM. (6 marks) Question 3 Appraise the appropriate valuation method to assess the fair value of the company under study and explain the rationale and approach. (9 marks) Question 4 Organise the analysis to do the valuation of the company and summarise results in a table. All workings to be attached in the Appendix. State all assumptions used in the valuation model adopted. Explain the use of the rating categories and rationale, and assign an appropriate house rating to the stock covered. (25 marks) FIN355 Assignment 2 SIM UNIVERSITY Assignment 2 – Page 4 of 4 Question 5 Organise your security analysis and recommend to the house whether the covered stock is appropriate for investment and list down all appropriate justifications. In the stock recommendation, indicate the Target Price, Investment Horizon and Target Total Returns. (15 marks) REPORT QUALITY (10 marks) Your report will be assessed for quality, conciseness and appropriate use of reporting aids (graphs, tables, illustrations, etc). The total marks allocated for this assessment is 10 marks and broken down accordingly as: 1. Layout and formatting (3 marks) (a) Format follows a logical reporting flow (1 mark) (b) Format is consistent throughout report (1 mark) (c) Layout follows guideline of not more than 15 pages (1 mark) 2. Standard of language used (5 marks) (a) No excessive spelling or grammar mistakes (2 marks) (b) Good use of technical vocabulary (3 marks) 3. Use of presentation aids (2 marks) (a) Title Page formatted clearly and use of Table of Contents (1 mark) (b) Use graphs, tables and/or other visual aids (1 mark