“Into the
Real World”
Profiling a
Corp.
We
will use Special Activity 11-6 (or SA 11-6)on page 523 as a starting point for this project.
The point value for this assignment is only ___ points.
However, the purpose for assigning this exercise is to introduce you
to some research fundamentals that you will most likely be required to use at
the university level.
Gathering
information via the Internet:
Select
a public corporation that you have an interest in. Using the Internet, develop a short profile of the company.
See the list of requirements to include in the profile on page 523 of
your text. In addition to the
requirements listed in the book, also include the Stock Symbol and the price
earnings ratio (P/E ratio.) Further
information on how to research your company is included below.
Purchase
a fictitious 100 shares of your stock:
Research
the market price of a share of stock of the company you pick on the day of
this assignment. Write down the
cost of purchasing 100 shares of this stock.
Using the attached worksheet, figure out the “net investment” cost
of the stock.
Calculate
the return two weeks later:
Two
weeks from today, you will again research the stock price.
You will calculate the return by completing the attached worksheet.
We will compare the % return on investment with other classmates.
More on
gathering information about your company.
There
are many ways to research a company. Some
of you may choose to use readily available search engines such as Yahoo,
Lycos, and Infoseek.
Most
of the information you need can also be obtained from many different Web
pages. Here are just a few
examples of some sites you may want to try:
Microsoft News Network http.//msn.com
The
New York Times
http://www.nyse.com
Quicken
Financial Network
http://www.quicken.com
The
Financial Center
http://tfc.com
Money
Magazine Online http://pathfinder.com/money
Fortune
Magazine Online
http://cgi.pathfinder.com/fortune
The
Wall Street Journal http://wsj.com
Another
very useful tool for business majors doing financial research on a company is
a service offered by the Securities and Exchange Commission
(SEC) called the EDGAR database. EDGAR
(Electronic Data Gathering, Analysis, and Retrieval System) performs automated
collection, validation, indexing, acceptance, and forwarding of submissions by
companies who are required by law to file forms with the US SEC.
As stated in its web page, its primary purpose is to increase the
efficiency and fairness of the securities market for the benefit of investors.
Be
forewarned that the SEC filings are usually very long.
Be careful of what you print out because it
could be well over 100 pages long.
For class purposes, I would suggest you just get into the site and pull
up a public filing. DO
NOT automatically print it out.
To
get to EDGAR, go to the following URL address:
www.sec.gov/edgarhp.htm
Then
go to the “Search EDGAR Archives” option.
Type in a company name where prompted and a list of SEC filings will be brought up. You should be familiar with the following types of reports:
·
10K
Annual Report
·
10Q
Quarterly Report
·
8K
This could be a Pro-forma statement or some other type of earnings
press release, or a major event which is required to be disclosed by SEC
rules.
Click
on whatever file you find to review the contents.
Final Note:
The purpose of this is to expose you to various research resources and to, hopefully, bring some “real life” into the chapter on stocks. Have Fun! Don’t be afraid to experiment. You may want to pick 3 or 4 companies just for fun and see how much “wealth” you can accumulate. Above all, please ask questions.