1. Business. In this section provide a brief description of where your company fits in its industry. What products do they sell? Who are their primary customers and suppliers?
Who are their main competitors?
2. Industry. In this area provide a brief description of the industry outlook. Your primary
resources here are some of the publications mentioned in chapter 5 of the Gibson
textbook (e.g. Standard & Poor’s Industry Surveys, Value Line Investment Survey, etc.),
as well as news articles (from publications such as The Wall Street Journal, New York
Times, Washington Post, and the Financial Times). You will need a different resource for each group member. I recommend that each one of the group members reviews a
different industry publication and provides a summary industry description identifying where the information was obtained.
3. Complete the “FR & Comparisons” worksheet in the “Comparison with Industry &
Peers” file based on the financial statements of your company – you can find these
statements approximately in the middle of your company’s 10K reports (right after or
before the independent auditor’s report). In the Modules 10K reports area, I have posted
the three latest 10K reports for each company which you will need for this assignment.
Specifically, you need to submit the following:
a) The financial summary and ratio calculations using the formula sheet (all the areas that
are highlighted in yellow).
b) Perform trend analysis. Using the ratios that you calculated, identify the areas that show improvement and the areas of potential concern. You can describe the trends in
simple terms such as improving, stable, fluctuating, etc.
c) Under the RMA Norm column, list the industry median values for the subject ratios
(the ones highlighted in yellow). Then compare your ratios to the industry ones and
indicate whether they are better/favorable, worse/unfavorable or the same.
d) Compare your company’s ratios to the ratios of the other company in your group; what
you need to do here is to rank the ratios for your companies for the most recent year i.e. 1
or 2 with 1 being the best. You can use the last column in this worksheet to present your comparisons.
4. For your company, assuming an anticipated 10% sales increase in the following year
calculate the following:
a. Working Assets in the most recent year that you have data for.
b. Working Liabilities in the most recent year that you have data for.
c. Working Investment in the same year.
d. Working Investment Factor in the same year.
e. New Working Investment in the following year.
f. What are the company’s additional working investment needs in the upcoming year?
g. Can the company cover these additional needs internally? If not, how much it needs from external sources?
It should be noted that items a through c have already been calculated in your worksheet
but they should be shown again here for comparison purposes
5. For your company, provide answers to the following questions:
a. Why has leverage increased or decreased during this period?
b. Is your company using debt efficiently? (Use the financial leverage index ratio)
c. How well is your company covering fixed charges? (Use the times interest earned, the
fixed charge coverage and the cash flow adequacy ratios).
6. Review your company’s cash flow statement. What are your company’s major cash inflows and outflows? What are their sources of cash? Where do they invest it?
7. Consider your company’s Return on Equity ratio (ROE=Net Profit/Total Equity). What is the trend during this period? As developed by DuPont and shown below:
ROE = (Net Profit/Total Sales) x (Total Sales/Total Assets) x (Total Assets/Total Equity)
or ROE = Net Profit Margin x Total Asset Turnover x Equity Multiplier. Using these last three ratios, explain the trend in the return on equity. For example, if your company’s
ROE has declined, is it due to a drop in the net profit margin (profitability problem), total asset turnover (efficiency problem) or equity multiplier (a financial leverage issue).
8. Calculate the Economic Value Added (EVA) for your company for this period assuming a 10% cost of capital. Discuss the EVA trend and provide reasons for the increases/decreases. How does this reconcile with the DuPont Analysis?
(Formula: EVA = EBIT(1-T) – (Total Invested Capital x Cost of Capital)).
9. Based on your analysis list your company’s strengths and weaknesses (in bullet points).
You Hire Us, You Get An Order Similar To The Quality Below
Following the recent
ruling that pre-exposure prophylaxis (PrEP) can be prescribed for the
prevention of HIV within the National Health Service, what potential impact
might this have for individuals, health care and society?
prophylaxis (PrEP) is medication taken by individuals without a diagnosis of
HIV, in order to reduce the risk of contracting the virus (Spinner et al.,
2016). The regimen of PrEP is typically composed of antiretrovirals in a
combined pill, typically tenofovir disoproxil fumarate and emtricitabine
(Brydon, 2018). In HIV-infected individuals, these antiretrovirals serve to
treat the infection, reducing the viral load of the patient; lifelong therapy
is needed with antiretrovirals to prevent clinical disease (i.e. AIDS) (Kelen
and Cresswell, 2017). In HIV-negative individuals the purpose of PrEP is not to
prevent viral transmission or entry into the body, but to reduce viral
replication to a level whereby the immune system can eradicate infected cells,
preventing established HIV infection (Brydon, 2018).
The evidence base
supporting the use of PrEP is substantial, indicating a reduction in HIV
transmission, particularly in men who have sex with men (MSM), a key target
population (e.g. Volk et al., 2015; LeVasseur et al., 2018). Therefore, PrEP
can be considered an effective preventative approach, along with other
strategies to prevent HIV infection, such as condom use (barriers methods) and
male circumcision (Dolling et al., 2014). This has led to the approval of PrEP
for the prevention of HIV within the National Health Service (NHS) within the
last year, building on the availability of PrEP in Scotland (Nandwani, 2017).
The remainder of this paper will consider the potential impact of this approval
process, focusing on individual, health care, and societal outcomes.
The changes in availability and use of PrEP can have massive
effects on the individual. Firstly, NHS funding of PrEP can increase access to
the drugs and affordability of these drugs (Nichols and Meyer-Rath, 2017). PrEP
was only available through third parties and pharmacies from other nations,
increasing the cost of this preventative strategy and the risk of unreliable
sourcing from online companies (Brydon, 2018). Affordability and access are
particularly important in vulnerable groups and socioeconomically disadvantaged
members of the population, who may be at a higher risk of HIV infection
(Spinner et al., 2016).
One of the main individual benefits of the availability of PrEP
is the expansion of options available for those who are at-risk of HIV. Current
preventative strategies can have significant limitations, which limit their
practical application (Frankis et al., 2016). For instance, condom use requires
access to condoms and positive attitudes to their use, which are not always
present due to perceptions of diminished sexual pleasure (Dolling et all.,
2014). In these individuals, PrEP can provide an alternative to condom use and
ultimately empowers individuals to manage health risk (Frankis et al., 2016).
Other factors that interfere with traditional HIV prevention
practices, including religious beliefs, cultural factors and personal attitudes
to condom use, may lead to an acceptance of PrEP, increasing the power of the
individual to prevent HIV transmission (Stewart, 2016). Providing increased
opportunities and options for individuals to prevent HIV transmission is vital
in promoting heathier sexual behaviours, while increasing individual autonomy
and self-efficacy (Harawa et al., 2017). Therefore, the impact of PrEP approval
within the NHS may benefit those at greatest risk, while broadening access and
availability of preventative measures.
It is important to note that PrEP use does not protect against
sexually transmitted infections (STIs) and that the role of condoms in
preventing both HIV and STIs remains important and should be communicated to
individuals interested in PrEP (Storholm et al., 2017). Furthermore, individual
benefits are only possible if adherence to PrEP is likely to be optimal;
non-adherence reduces the effectiveness of the drug combination and can
increase risk of HIV transmission (Storholm et al., 2017). Therefore, selection
of the target population and individual education on PrEP use will be essential
in ensuring benefits. At present, 10,000 people are enrolled onto the PrEP
IMPACT evaluation in England and the results of this trial will provide
valuable insights into the individual benefits of the use of PrEP (NHS England,
From a health care perspective, the funding of PrEP by the NHS
can be considered beneficial in a number of ways. Principally, PrEP has been
shown to have a significant impact on HIV transmission rates in trials and ‘real-world’
evaluations, which may translate into a reduced HIV burden in the population
(Fonner et al., 2016; McCormack et al., 2016; Sagaon-Teyssier et al., 2016).
HIV infection is still associated with significant morbidity and mortality in
the population and therefore prevention can have significant benefits in how
health services manage population health (Hankins et al., 2015).
Furthermore, one of the most important impacts of PrEP use in
MSM from a health service perspective is the potential for cost savings in the
short and/or long term due to reduced rates of HIV infection. A
cost-effectiveness and modelling analysis has shown that PrEP in MSM is
associated with cost savings, based on an initial rollout of 4000 men within
the first year (Cambiano et al., 2018). Similar analyses have been performed
and are associated with cost savings with PrEP use, depending on the length of
time the projections are designed, the use of condoms within the target
population, the rate of STIs in the target population and the cost of
antiretroviral drugs (Drabo et al., 2016; Cambiano et al., 2018; Fu et al.,
Possible negative effects of PrEP have been considered in the
literature, with a predominant focus on an anticipated decline in condom use,
rise in STIs and the costs associated with these conditions (Kelen and
Cresswell, 2017). Although the relationship between condom use and PrEP use is
complex, there is no clear evidence that PrEP reduces condom use during sex,
although up to 30% of HIV-negative men with HIV-positive partners suggested
that they may be less likely to use condoms if PrEP were available in one study
(Hoff et al., 2015). However, in the context of committed couples, this may not
translate to an increased risk of STIs, although the risk of HIV transmission
needs to be considered in individuals who are less likely to use condoms (Hoff
et al., 2015). Furthermore, the IPERGAY (Intervention Préventive de
l’Exposition aux Risques avec et pour les Gays) study found equal rates of STIs
in patients using PrEP and those not using PrEP to prevent HIV transmission,
suggesting that risk-taking may not be associated with PrEP use
(Sagayon-Teyssier et al., 2016).
The cost-effectiveness of PrEP use in the NHS will partly depend
on the potential for an increase in condomless sex and STIs, suggesting that
this possibility should be closely monitored to ensure cost savings and
population health (Cambiano et al., 2018). More data will be needed to assess
the health care impact of PrEP use, particularly as the target population
becomes more clearly defined and expansion of PrEP use in England occurs (NHS
Finally, on a societal level, there is an important need to
consider the wider ethical, social and cultural aspects of PrEP use and the
impact of PrEP. Indeed, views on HIV and HIV management are often highly
polarized in society and within the British media (Jaspal and Nerlich, 2017).
HIV is associated with a significant level of stigma and any strategies used to
combat infection rates and to reduce the risks of relationships between
HIV-negative and HIV-positive individuals may serve to reduce stigma to some
extent (Grace et al., 2018). The psychological toll of stigma should not be
underestimated and strategies that alleviate stigma can have significant
benefits for quality of life and wellbeing (Grace et al., 2018).
However, part of the polarized perception of HIV management in
society associates negative connotations with the use of PrEP. An argument
against PrEP use for the prevention of HIV in the general population is the
perception that the medication could be seen as an invitation to promiscuity or
condomless sex, with negative moral and health implications (Knight et al.,
2016; Brydon, 2018). Similar arguments are generally proposed for all advances
in sexual health services (e.g. oral contraception) but are not generally
supported by the research evidence (Calabrese et al., 2016).
Therefore, it is important to ensure that public awareness and
education of the role of PrEP and the massive potential benefits of the
approach are not obscured by misinformation or unfounded claims in the media
(Jaspal and Nerlich, 2017). Health care professionals are well-placed to inform
the public and address such sources of misinformation but need to be supported
by policy makers and national guidance (Calabrese et al., 2016; Desai et al.,
2016). However, wider societal attitudes and stigma associated with HIV needs
to be challenged through policy and law-making to ensure individuals at-risk of
HIV have access to PrEP (Serrant, 2016).
In summary, the use of PrEP for the prevention of HIV infections
in the UK is supported by the evidence base and has become an important aspect
of NHS-funded interventions for those at-risk of HIV infection. The potential
impact of PrEP can be seen on an individual, health care and society level,
with reductions in HIV infections, cost savings, and improved availability and
access to health services. The implementation of PrEP needs to be closely
monitored to ensure public awareness and education is facilitated to prevent
negative health behaviors and risks.