BUS85 De Anza College Investment Club Report Presentation

As a member of an investment club, use a PowerPoint presentation to report to the membership on whether the club should purchase shares of Alibaba (BABA), Amazon (AMZN), Apple (AAPL), Facebook (FB), and Google (GOOGL).

You can find some relevant information by going to a personal finance site such as Yahoo Finance (Links to an external site.)Links to an external site.. Once there, you may want to look at the following in order to gather some information about past performance, current status and (to a lesser extent, with analyst forecasts) future prospects for each stock. Put in the stock ticker symbol (such as AMZN) over on the right side of the screen where there’s a box for “quote lookup”. Then:

* Look under the Statistics tab for data such as revenue growth rate, earnings growth rate, operating margin and P/E (price/earnings ratio). How fast are revenues and earnings growing in the last 12 months (TTM, or “trailing 12 months”)? Is its P/E higher or lower than average for S&P 500 stocks, whose P/E as of today (6/18/2019) is about 22? If Amazon’s P/E is 79, then it is MUCH more highly valued than the average dollar of earnings for the rest of the market. That says that the market is very optimistic about Amazon’s future growth prospects — optimism which may prove to be correct … or not. In general, all five of these companies are highly valued because of their dominant market position, growth rate, innovative ways of doing business and the strong defensive “moat” around their business that deters competitors.

* For more detailed information, look at the financial statements themselves under the Financials tab. There you can see four years of financial statements: income statement, balance sheet, and cash flow statement. I suggest focusing on the income statement. Is the company’s revenue growth rate year over year speeding up or slowing down? How about its earnings growth rate?

For analyst reports that cover some of the above data as well as the companies’ future prospects, see the following CFRA reports:

Alibaba (Links to an external site.)Links to an external site.
Amazon (Links to an external site.)Links to an external site.
Apple (Links to an external site.)Links to an external site.
Facebook (Links to an external site.)Links to an external site.
Google (Links to an external site.)Links to an external site.

Are the analysts projecting that the price of the stock will go up or down? If up, by a lot or a little? Since average investment returns on the stock market fall in the 5-10% range over the long term, if the 12-month forecast that is the stock price will rise less than that, there may not be much point in investing in that stock. You should read at least page 1 of the report, as well as the later section called “Industry Outlook” or “Sub-industry Outlook”. What does this outlook say about the company’s longer-term prospects?

Your report should cover: (a) past performance, (b) current status, and (c) future prospects for the SHORT and LONG run. Remember: You have to make a recommendation as to which shares to purchase.

Please remember this as well. You should make the PowerPoint presentation on all FIVE companies, before making your recommendation as to which company’s shares to purchase. A PowerPoint presentation on only ONE company will not be accepted. Use some of the principles of visual design you have learned earlier in the course. Also think of the basic principles of writing reports as explained in Chapter 12 (this is however a Powerpoint presentation, very different than many of the formats discussed in that chapter) and of making presentations as laid out in Chapter 13.

[100 points]

 
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