Check the attached “Company List” file and find the TWO companies that are assigned to you (i.e., “your companies”) and complete the following:Check online to find what sector each of those two companies belongs to.Look up the following financial ratios or items for each of your companies:Long-term Debt ratio (Long-term Debt/Total Assets)Return on Assets (ROA)Return on Equity (ROE)DividendsPast Five-year Growth RateFill in the table below for the above items:(Your company 1)(Your company 2)SectorLong-term Debt ratioROAROEDividendsPast 5-yr Growth RateCompare each of the above items between your two companies and answer the following questions:Which company has a higher Long-term Debt ratio?Do you think that their difference in debt ratio has to do with the sector or industry that each of them belongs to?What ROA and ROE represents, respectively?Which company has a higher ROA? Which company has a higher ROE? Does the company with a higher ROA also have a higher ROE? Why or why not?Before looking at the data, what would you expect to see the relationship between dividends and growth rate? In theory, are they supposed to be related in a positive or negative way? Why?Compare the dividends and the 5-year growth rates of your two companies. Did you see any pattern?NOTE:You may find all of the above information from Yahoo Finance website (finance.yahoo.com):First, logon to finance.yahoo.comAt the upper right corner you may find a search box with “Quote Lookup” in the box. Type in the “ticker symbol” of your company. Then, hit the search icon. You will be able to see your company’s name and summary information.Choose “Financials” from the blue option bar in the middle of the screen. Then you will be able to see the following on your screen:“Show: Income Statement Balance Sheet Cash Flow”You may click on the specific financial statements to find the information that you need for calculating the Long-term Debt ratio, Return on Assets and Return on Equity.To find the “past 5-year growth rate”, you need to click on the “Analysts” option from the blue option bar in the middle of the screen. Then, scroll down to the bottom and you will see ““Past 5 Years (per annum)”. That is the past 5-year growth rate.”To find the “dividends” amount, you need to click on the “Summary” option from the blue option bar in the middle of the screen. And, on the right side of the summary table you will find “forward dividend & yield”, where the first number is the dividends amount (that the company is expected to pay). Note that if it shows “N/A” (not available), then it means the company does not pay dividends, i.e., the dividend amount is zero.
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Check the attached “Company List” file and find the TWO
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