ISTANBUL TECHNICAL UNIVERSITY

Faculty of Management
Department of Management Engineering

ISL 333E FINANCE

Term Project: Financial Statement Analysis

Each student will work on a publicly-owned company (not a bank or financial institution).
Name of the company will be communicated by the course assistant on Ninova platform.

Students are required to use publicly available information to analyze and prepare a report
which provides an assessment of the company’s current position and future prospects. The
objective is to evaluate the financial performance of the company using financial analysis
methods taught in lectures.

The final submission of the assignment should include the main points listed below.

Students are expected to:

• Provide an evaluation of the company’s financial performance over time and also include
peer analysis.
• Conduct ratio analysis for the company and include peer industry comparison.
• An analysis of the current issues facing the company, the industry it operates in, and explain
the impact of the issues on the company’s future earnings.
• To evaluate how the selected company is performing over time, last year's (2020)
financial ratios are required.
o Liquidity Ratios: to measure the company's ability to pay its short term
obligations; (current ratio, acid test ratio and cash ratio)
o Efficiency Ratios: to measure the company's ability to utilize its assets;
(inventory turnover, accounts receivable turnover, plant asset turnover, asset
turnover, operating cycle and cash cycle)
o Solvency Ratios: to measure the extent to which the company's assets are
financed with debt; and ability to fulfill long term debt. (debt to asset ratio,
times interest earned ratio)
o Profitability Ratios: to measure the company's ability to generate earnings;
(gross profit margin, operating profit margin, net profit margin, return on asset,
return on equity)
o Market Value Ratios: to measure the market perception about the company's
future prospects. (price to earnings, price to book value, earnings per share
ratio)
• Evaluate the company's financial performance in comparison to its key competitors or
industry averages (the industry comparative analysis must be performed).
o Industry averages can be found on Central Bank website.
• Include a brief (4-6 page double spaced) evaluation of your company’s metrics,
comprising five sections:
o A brief summary of the company’s business and the economic environment in
which it operates.
o A brief evaluation of the company over time using financial analysis.
o A brief evaluation of the company’s liquidity, efficiency, solvency (leverage),
profitability and market value ratios over time.

Submission Deadline: Dec 12, 2021