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You have decided to analyze two major publicly held companies: Advanced Micro Devices (AMD) and Intel (INTC). You will need to examine data from their Balance Sheets, Income Statements, and Cash Flow Statements.
Go to the SEC website (www.sec.gov) and locate Search Edgar for Company Filings. One by one, enter the name of each company (AMD, Intel). In the box titled Filing Type, enter 10-K and then Search to obtain annual information. The Documents heading will reveal information about the following:
important aspects of the business
risk factors
management's discussion and analysis of financial condition
results of operations
opinions of the auditor and management about controls
financial statements
The heading Interactive Data will allow you to view financial statements that can be copied into Excel.
Alternatively, you can find the same information on finance.yahoo.com. The ticker symbols are AMD and INTC. Look for the items under Financials on the side left menu bar of each firm's page.
"This is a LOT of information! Would you mind summarizing your findings by answering the following questions?" Show your calculations.
Question 1: The profit margin is an indication of pricing. Does one company price lower than the other? If so, which company?
Question 2: Does one company turn over assets faster than the other? If so, which one? This is an indication of supply chain management and product life.
Question 3: Does one company have more debt than the other? If so, which one?
Question 4: Does one company earn a greater return on shareholder investment? If so, which one?
Question 5: Are there any significant differences between companies in Balance Sheet ratios? Is one company more at risk, financially? If so, indicate which one.
The CFO continues, "Please also summarize the significant risks and important aspects of the business for both companies from the perspective of management and external auditors. Thanks again for going the extra mile for us!"
Submit your Comparative Risk Assessment Report and Calculations to your assignment folder. Be sure to show your calculations in Excel and provide a narrative analysis. Your narrative analysis should summarize the results of your analysis and make recommendations for the benefit of company.
