Analyze the Consolidated Statements of Cash Flows for each company for the fiscal year ended January 29, 2017 for Home Depot and February 3, 2017 for Lowe’s, by answering the questions in the table provided in the template.
Financial Analysis Case link. Please save your file with the initial of your first name and your last name. Use single space with proper
English. I will take off .25 pts. for each grammar and spelling error. Please answer the requirements in the order they are set up on the
template, which follows the requirements listed below. Also include your name on the first page of the template submission. Use the SEC
EDGAR website: www.sec.gov to locate the Form 10-K Document forHome Depot, Inc. (Ticker HD) for fiscal year ending January 29, 2017and Lowe’s
Companies, Inc. (Ticker LOW) for fiscal year ending February 3, 2017. Use Module 1 Appendixes 1A and 2A and Module 2 as a guide to assisting
you in finding the applicable 10-K and the other resources I provided above in this document. Answer the following questions using the 10-K
document for each company posted on SEC EDGAR. Do not use the interactive Data file to answer Part 1 of the Financial Analysis Case.
1. Provide the URL address of each of 10-K reports at the SEC EDGAR website and give the state the company is incorporated in for each of the
companies for the period ending January 29, 2017 for The Home Depot, Inc. and for the period ending February 3, 2017 for Lowe’s Companies, Inc.
2. Summarize the company’s business operations as discussed in the beginning of the company’s 10-K in Item 1 for each company. Provide the
page number(s) for each of the 10-Ks you are using to support your response.
3. What are the total assets, the total liabilities, and the total equity using the audited financial statements for the fiscal year ended
January 29, 2017 for Home Depot and February 3, 2017 for Lowe’savailable in Item 8 of the 10-K? Provide the dollar amounts stated in the
financial statements and the name of the financial statement as stated in the 10-K. Compare andContrast the size of the net assets (same as
book value or same as equity) of the two companies.
4. What are the sales or net sales, cost of sales, and net income or net earnings of the two companies using the audited financial statements
available in Item 8 in the table of contents for Home Depot and Lowe’s? The companies may not use the exact same titles I have used, but you
need to be able to identify the account title that means the same thing as what I have listed. Provide the dollar amounts and name of the
financial statement you found the information at. Compare and Contrast the size of sales and net incomes of the two companies.
5. Compute the average assets, return on assets (answer should be shown in percentage terms), profit margin (answer should be shown in
percentage terms), and asset turnover (answer should not be in percentage terms) for the most recent year of the 10-K using the table provided
in the template. The companies may not use a variation of the account used in the calculation, so adapt to what is provided in the financial
statements. You are required to show calculations to earn credit. Take calculations to 2 decimal points. Please review pages 1-19 and 1-20.
Compare and Contrast and comment upon the findings. Your comments should include how the profit margin and asset turnover are impacting the
return on assets.
6. Analyze the Consolidated Statements of Cash Flows for each company for the fiscal year ended January 29, 2017 for Home Depot and February 3,
2017 for Lowe’s, by answering the questions in the table provided in the template.
7. Make sure you have read over Module 1 Appendix 1B before you complete this part of the project. Find and read the audit report of the
consolidated statements. Do not provide the report of the internal controls for each of the companies, since this is a different report. Make
sure you are providing the correct report of independent registered public accounting firm on consolidated financial statements. Provide the
following information in the table provided in the template for each company: Who is the report addressed to? Who are the auditors? What is
the nature of the opinion? Compare and Contrast the information provided in the report.
8. Make sure you review page 1-18 in Module 1 that discusses the requirement of the CEO and CFO to sign the annual report and to take
responsibility for the annual report and it is management’s responsibility under the Sarbanes-Oxley Act (SOX). Find the page(s) signed by the
CEO, CFO, and the Board of Directorspursuant to the requirements of the Securities Exchange Act of 1934. Review the information provided in
Item 9a of the 10-K. Explain what each company has provided to their shareholders per the Security Exchange Act of 1934 in Item 9a.
9. Access the D&B Business Browser database in the Bellevue University Online Library databases. Please click on this link to access the
Bellevue University D&B Business Browser Tutorial http://www.screencast.com/t/o3hG3Z8adHere is a short video on how to use the Bellevue
University Online library https://vimeo.com/147731613
The D&B Business Browser database can be found at the library webpage, which can be accessed through the Student Services tab. You should click
the Find drop down and pick A-Z Database List and then click on “D” and click D&B Business Browser.
Search for each company (Home Depot, Inc. Inc.-ticker HD and Lowe’s Companies, Inc.-Ticker LOW), under the Company area and access the SWOT
analysis through the D&B Business Browser database. Review the SWOT analysis for both companies and summarize the competitive landscape by
referencing information provided in the SWOT analysis as it relates to the competitive landscape. Your summary must include specific
information about the competitive landscape for each of the companies. You need to understand the competitive position of each company so that
you can assess the company’s financial statements in a broader context. In Module 1, the author discusses the analysis of analyzing the
competitive environment starting on page 1-22. Please review this part of the text when analyzing the SWOT analysis of each of the companies.
10. Review the corporate governance guidelines document of each company by visiting the company website atHome Depot
http://ir.homedepot.com/corporate-governance/overview
and Lowe’s http://phx.corporate-ir.net/phoenix.zhtml?c=95223&p=irol-govguidelines Please make sure you have reviewed the discussion in Module 1
page 1-30 on corporate governance. What is the main purpose of this document and list out 5 areas that were referenced from each of the
company’s corporate governance guidelines?
11. Determine the market capitalization for the year end we are working on for each company. Please review pages 2-11 and 2-12. Here is an easy
read article comparing book to market:
Gad, Sham. May 31, 2017. Market Value versus Book Value. Investopedia. http://www.investopedia.com/articles/investing/110613/market-value-
versus-book-value.asp
You can determine the number of shares outstanding from the balance sheet of Home Depot and Lowe’s. Make sure you are using outstanding shares
of stock which can be determined by referencing the balance sheet. You can obtain the stock price on the last day of the fiscal year we are
reviewing if it is not a weekend. For Home Depot use the closing price for January 27, 2017, since it is the last market day for the fiscal
year by going to the Market Watch Website for Historical Stock prices. http://www.marketwatch.com/tools/quotes/historical.asp Make sure you
pick up the closing price for January 27, 2017 for Home Depot and February 3, 2017 for Lowe’s.
Complete the table on the template for each company and comment on the companies’ market to book ratios, which is also called the price-to-book
ratio. You need to show your work on how you are calculating your numbers to earn credit. Also, provide comments on your results.
Grading Rubric Part 1
Question 1 1 pt. for each URL and state. Total points possible 4 pts
Question 2 2 pts. for each summary of business operations and 1 pt. each for page number reference. Total points possible 6 pts.
Question 3 1 pt. for each amount not calculated and title of financial statements. 2 pts. each for total liabilities. 2 pts. for
contrasting. Total points possible 12 pts.
Question 4 Grading: 1 pt. for each amount and title of financial statements. 1 pt. for identifying different terms as stated in table. 2
pts. for contrasting. Total points possible 12 pts.
Question 5 Grading: 2 pt. for each calculation. Student must show calculation. 2 pts. for contrasting. Total points possible 18 pts.
Question 6 1 pt. for each answer. Total points possible 16 pts.
Question 7 1 pt. for each:Who is the report addressed to?Who are the auditors? What is the nature of the opinion? Compare and Contrast
the information provided in the report. 2 pts. for contrasting. Total points possible 8 pts.
Question 8 1 pt. for each page reference signed off by CEO and CFO. 1 pt. each for explanation of items in 9a. Total points possible 4pts.
Question 9 2 pts. for each reference of SWOT analysis on competitive landscape using One Source Business. Total points possible 4 pts.
Question 10 1 pt. for purpose and 1 pt. for listing out at least 5 areas for each company. Total points possible 4 pts.
Question 11 1 pt. for each Book value and 2 pts. for each calculation of Market value and Market-to-book. 2 pts. for comment. Total points
possible 12 pts.
Total points 100 pts. I will deduct .25 pts. For each spelling and grammar error.You will be penalized 20% of the grade if it is turned in
after the due date but no later than 48 hours from due date. You will earn a zero for the part of the case if not turned earned by the 48 hour
late penalty.