Under the Week 5 tab of the excel file attached, gather the valuation and liquidity information about TESLA and NISSAN. (Hint: Use Morningstar.com again to gather this information. Find your stock, select Valuation, and scroll to the bottom to Key Statistics.)
Part Two
In a memo to the Chief Executive Officer, answer the following questions, which are pre-loaded in your Memo Template:
- A business valuation gives an economic value to a business. After looking at the Valuation tab (i.e., P/E, P/B, P/S, and Price to Cash Flow) in Morningstar.com and any other helpful material, does your chosen company appear to be more “valuable” than its closest competitor? What can you glean from the historical valuation data?
- Liquidity ratios are financial ratios that measure a company’s ability to repay both short- and long-term obligations. After looking at the Financial Health information in Morningstar.com (i.e., current ratio, quick ratio, financial leverage, and D/E ratio), how does your chosen company compare to its closest competitor? What information can you infer from these liquidity ratios?
- Which of the two companies is the “better run company”?