Investment Psychology: Analysis of Domino's Pizza, Google, and Delta Air Lines

This article provides an analysis of the financial performance of Domino's Pizza, Google, and Delta Air Lines to identify investment opportunities. It includes answers to questions related to quick ratio, operating margin, debt/equity, gross margin, and market cap.

Running head: INVESTMENT PSYCHOLOGY
Investment Psychology
Name of the Student:
Name of the University:
Authors Note:

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Table of Contents
Introduction:...............................................................................................................................2
Answer to question 1:.................................................................................................................2
Answer to question 2:.................................................................................................................2
Answer to question 3:.................................................................................................................4
Answer to question 4:.................................................................................................................4
Answer to question 5:.................................................................................................................6
Conclusion:................................................................................................................................6
Reference and Bibliography:......................................................................................................8

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Introduction:
The analysis on such as Domino’s Pizza Inc., Google Inc., Delta Air Lines Inc is
mainly conducted in the assessment to identify the future prospective and detect the
investment viability in this company. The assessment evaluates the financial performance of
selected companies, which could eventually help and detecting whether there is a viable
investment scope for investors. The pattern recognition, which is conducted by evaluating
historical price movements is also helpful in detecting the overall trend of the organizations.
Answer to question 1:
Domino’s Pizza Inc., Google Inc., Delta Air Lines Inc is selected from the overall
portfolio, where adequate research could be conducted to identify the investment
opportunities and future performance of the companies. The Domino's Pizza Inc is iteratively
under Food processing industry, why Google Inc falls under the information technology
industry. Lastly, the Delta airlines company mainly falls under the Airline industry.
Answer to question 2:
Delta Air Lines Inc 2015 2016 2017
Quick Ratio 0.32 0.35 0.27
Operating Margin 27.82% 25.36% 22.86%
Debt/Equity 0.62 0.5 0.47
Gross Margin 58.00% 59.79% 57.91%
Financial performance of delta Airlines can be identified from the above table, which
would allow investors to conduct adequate investment decision. The quick ratio, gross margin

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ratio, and operating margin ratio of the company has declined. However, the debt ratio of the
company has relatively decline, which indicated and improvement anus financial capability1.
Domino’s Pizza Inc 2015 2016 2017
Operating Margin 18.290% 18.360
%
18.700%
Quick Ratio 0.700 0.480 0.530
Gross Margin 30.820% 31.050
%
31.060%
Interest coverage 4.080 4.130 4.270
The profit margin, interest coverage ratio, gross margin of the company has a
relatively improved over a period of 3 years. This mainly indicates the high capability of the
organization to generate returns from investment. However, the quick ratio the company
declined, which stated in the hi accumulation of current liabilities in comparison to current
assets.
Google 2015 2016 2017
Quick Ratio 4.5 6 4.98
Operating Margin 25.82% 26.27% 23.59%
Debt/Equity 0.02 0.03 0.02
Gross Margin 62.44% 61.08% 58.88%
1 Nasdaq.com 2018, https://www.nasdaq.com/symbol/dal/competitors?
sortname=lastsale&sorttype=1. Accessed 9 Apr 2018.

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From the valuation, it could be seen that the financial position of Google has
improved in 2017, as the quick ratio and debt to equity ratio has a relatively increased over
the financial years. However, the client in operating margin and gross margin is seen, which
was conducted due to high expenses incurred by the organization doing the financial years2.
Answer to question 3:
The selection decision was mainly made on both logical and instinctual basis, as the
organization selected for the portfolio are the market leaders, which would eventually help in
generating high returns. Furthermore, the logical reason for selecting the stock is the pricing
performance of the organizations which has been conducted over the past years. In addition,
the companies such as Domino's and Google would eventually increase their revenues in long
run, which would support the capital growth needed from the portfolio3.
Answer to question 4:
CompanyName Price Market Cap P / E Ratio
SkyWest, Inc. $ 55 2,856,034 7
Delta Air Lines, Inc. $ 53 37,501,735 11
The competitive level of delta airline is evaluated in the above table, where P/E ratio
and market cap of the organization is a relatively higher in comparison to its competitor.
2Nasdaq.com 2018, https://www.nasdaq.com/symbol/dpz/competitors?
sortname=lastsale&sorttype=1. Accessed 9 Apr 2018.
3 Baumann, Michael Heinrich, and Lars Grüne. "Simultaneously long short trading in discrete
and continuous time." Systems & Control Letters 99 (2017): 85-89.

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However, the share price of the organization is relatively low in comparison to its
competitors, which indicates a possibility of price increment in future.
CompanyName Price Market Cap P / E Ratio
Sysco Corporation $ 60 31,169,003 27
Domino's Pizza Inc $ 231 9,968,982 40
The above table reverently represents the competitive edge of Domino's against Sysco
Corporation, which would eventually help in detecting financial viability of the company.
The overall t ratio and share price of Domino's is relatively higher than its competitor, where
is the market cap of Sysco corporation is higher. The market cap of Dominos is relatively
lower than Sysco Corporation, which is relatively due to the high prices of the organization.
CompanyName Price Market Cap P / E Ratio
Facebook, Inc. $ 157.20 376,638,938 29.17
GOOGL Alphabet Inc. $ 1,009.95 301,463,005 56.23
From the overall evaluation, Google is considered to be the most viable investment
option, which could help in generating high level of returns from investment. The current
price and see ratio of Google is relatively higher in comparison to Facebook, while the
market cap of Facebook is higher due to the low prices of the organization.
Answer to question 5:
CompanyName Price 52 Weeks High / Low
Domino's Pizza Inc 231.46 $ 236.93/$ 166.74
Delta Air Lines, Inc. 53.05 $ 60.79/$ 43.81

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GOOGL Alphabet Inc. 1009.95 $ 1,198/$ 834.60
From the overall evaluation, the 52-week high and low share price of the company is
relevantly depicted in the above table. In addition, the overall prices of the company are at
adequate level, which indicates the possibility of rising share prices for all the three
companies. The share price valuation of Domino's Pizza is relatively close to the 52 weeks
high value, which indicate that the current trend of the organization is relatively up, which the
pics that the share price of the organization will eventually increase in future. Moreover, The
Delta price is relatively close to 52 weeks high, which could eventually help in improving the
financial position of investors. Likewise, the share price of Google is also at 52 weeks high,
which depicts the pricing trend of the organization, where new highs would be achieved in
future4.
Conclusion:
From the valuation it could be identified that Domino's pizza and Google is identified
to be an adequate investment opportunity, which could increase returns of the investors. The
financial ratios and the current trend of the organization is a relatively positive, which could
eventually allow investors to generate higher returns from investment. hence, the stocks could
be associated with the portfolio for increasing the returns of the investors. However,
neglecting the shares of delta airline is mainly a viable option, where the financial
performance of the company is not adequate.
4 Chandra, Prasanna. Investment analysis and portfolio management. McGraw-Hill
Education, 2017.

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Reference and Bibliography:
Baumann, Michael Heinrich, and Lars Grüne. "Simultaneously long short trading in discrete
and continuous time." Systems & Control Letters 99 (2017): 85-89.
Chandra, Prasanna. Investment analysis and portfolio management. McGraw-Hill Education,
2017.
Kang, Yan-Qing, et al. "Environmental assessment and investment strategy for China's
manufacturing industry: A non-radial DEA based analysis." Journal of Cleaner
Production175 (2018): 501-511.
Mikesell, Raymond F., and John W. Whitney. The world mining industry: Investment
strategy and public policy. Routledge, 2017.
Nasdaq.com 2018, https://www.nasdaq.com/symbol/dal/competitors?
sortname=lastsale&sorttype=1. Accessed 9 Apr 2018.
Nasdaq.com 2018, https://www.nasdaq.com/symbol/dpz/competitors?
sortname=lastsale&sorttype=1. Accessed 9 Apr 2018.
Nasdaq.com 2018, https://www.nasdaq.com/symbol/goog/competitors?
sortname=lastsale&sorttype=1. Accessed 9 Apr 2018.
Zhang, Xinhua, et al. "Analysis of carbon-abatement investment for thermal power market in
carbon-dispatching mode and policy recommendations." Energy 149 (2018): 954-966.