FIN 571 University of Phoenix Wk 6 Amazon Inc Financial Plan

Description

Write about the same Fortune 500 company from weeks two and four.
Describe the organization, including the type of business.
Create the business case.

Determine why funding is needed for the company.
Determine the sources of funding. Consider self-funding, borrowing, loans, equity, venture capital, etc.
Evaluate the requirements of each of the funding sources that you plan to use.
Analyze the risks that are associated with each funding source.
Decide which sources are the best fit for your company based on the requirements of each. Justify your decision.
Estimate the cost of capital for both short-term and long-term funding sources. Research current estimated APRs for your selected sources of funding. Create a table or chart to display this information.

Estimate direct costs, including the capital, marketing, labor, equipment, and inventory/supply costs for 2023, 2024, and 2025. The estimated costs are the costs for the profit-and-loss.
Prepare a budget that includes starting balances, monthly costs, loan/investment payments, cash flow projections, and required revenue. The budget is year one of the profit-and-loss, which is 2023.
Create a profit-and-loss statement for a 3-year period. The three-year period is 2023, 2024, and 2025. Provide a revenue forecast, stating realistic assumptions, such as growth per year, in your projections.
 

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Week 2 Assignment Investor Presentation 1
Assignment Outline
Eugene Johnson
FIN 571
University of Phoenix
James Traylor
June 6, 2022
Week 2 Assignment Investor Presentation 2
Learning Goals:
•
Conduct investor analysis for Fortune 500 company
•
Prepare presentation including various performance indicators as asked in the question.
Outline
The following information is included in the presentation as required in the question:
•
The company and its ticker symbol
•
Cash flow from operations
•
Price-to-earnings ratio
•
Stock dividends and the yield
•
Earnings per share ratio
•
Revenue estimates for the next 12 months
•
Revenue from the previous 3 years
•
Statement of cash flows and identify net cash from operating, investing, and financing
activities over the past 3 years
•
Average trade volume.
•
Current stock price, 52-week high, and 1-year estimated stock price
•
(buy, sell or hold)
•
Market cap for the company
Investor Presentation
Eugene Johnson
FIN 571
University of Phoenix
James Traylor
May 30, 2022
Company & Ticker Symbol
• Selected Fortune 500 company is Amazon Inc.
• The company is an American multinational technology company.
• It is a retail company.
• Involved in the sale of products such as groceries, beauty products e.t.c
• Largest in the online market; available in various countries.
• Ticker symbol: AMZN
Cash flow from operations
• From cash flow statement of for the year ended December 2021:
• Net cash flow from operating activities = $46,327 million
• The cash flow decreased from 2020 where it was $66,064 million.
• Large proportion of the cash flows come from amortization of property and
equipment.
• The company has been having positive cash flows from operations.
Price to earnings ratio
• P/E Ratio= share price/EPS
• Share price=$122.35
• EPS=$64.81
• P/E Ratio = 122.35/64.81 = 1.89
• The company’s stock price is high but the P/E ratio is low.
• The company has a high EPS.
Stock dividends and the yield
• Amazon has never paid dividends to his stockholders.
• This could be a turn off for investors since they seek constant returns
(Martin et al., 2020).
• Amazon’s earnings are under pressure from increasing costs of the company.
• The costs may keep increasing in the coming years.
• This means that the company may not pay dividends in the near future.
Earnings Per share Ratio
• Current EPS is $64.81
• EPS is monetary value of earnings divided by outstanding shares.
• The EPS of the company is not desirable.
• Companies that have EPS of higher than $80 do better.
• Amazon can improve EPS through lowering costs.
Revenue estimates for the next 12 months
Month
Jun-22
Jul-22 Aug-22
Revenues (in millions of dollars)
40,000
41000
Sep-22 Oct-22 Nov-22 Dec-22
Jan-23
Feb-23 Mar-23 Apr-23 May-23
41820 42656.4 43509.53 44379.72 45267.31 46172.66 47096.11 48038.03 48998.8 49978.77
Revenues for the last three years
Year
Revenue in millions of dollars
2019
280,522
2020
386,064
2021
469,822
Net cash from operating, investing, and
financing activities over the past 3 years
Year
Operating net cash
(millions $)
Investing net cash
(millions $)
Financing net cash
(millions $)
2019
38514
(24281)
(10,066)
2020
66064
(59611)
(1104)
2021
46,327
(58154)
6291
Average trade volume.
• This is the average number of shares traded within a day for a specific stock (Martin
et al., 2020).
• The Average trade volume for Amazon is $4.33 million.
• This shows that the company’s stock is trading so much (Hasanaj & Kuqi, 2019).
• The higher the average trade volume the higher the number of investors purchasing
stock.
• The trade volume is expected to rise as the value of the stock increases.
Current stock price, 52-week high, and 1-year
estimated stock price
• Current stock price is=$122.35
• 52 week high is $3,773.08
• 1 year estimated stock price= $4,192.97
• The company’s stock price is expected to go up.
• Increase in stock price will attract more investors.
buy, sell or hold?
• Analysts recommend that investors should buy Amazon’s stock.
• Growth of the company has been declining.
• However the company’s future prospects are promising (Hasanaj & Kuqi,
2019).
• The company is expected to be doing well in the coming years in terms of
revenues.
• Investors should buy the stock at current low prices.
Market cap
• As of 2022 the company’s market cap is $1.244 trillion
• This is the total value of all the shares of the company.
• The market cap is higher compared to most companies in the retail industry.
• The market cap of the company makes it a desirable company to invest in
(Hasanaj & Kuqi, 2019).
• To an investor market cap is value of the company; the higher the better.
References
• Amazon COM Inc 2021 annual report 10-K. (n.d.). Retrieved June 6, 2022, from
https://sec.report/Document/0001018724-22-000005/
• Hasanaj, P., & Kuqi, B. (2019). Analysis of financial statements. Humanities
and Social Science Research, 2(2), p17-p17.
• Martin, J. D., Keown, A. J., & Titman, S. (2020). Financial management: principles
and applications. Prentice Hall.

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