Opportunities to Invest into the Australian Market | Assignment
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Added on 2019-11-19
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Fundamental analysis is a study in which various stocks are evaluated on the basis of their worth in the market. The top-down analysis is the tool of fundamental analysis. In this report, various aspect of the industry has been analyzed such as fiscal policies, inflation, GDP, economic performance, environmental condition, economical condition, ratio analysis, income statement, cash flow statement, ratio analysis, balance sheet analysis, DU Pont analysis, etc has been evaluated.
Opportunities to Invest into the Australian Market | Assignment
Added on 2019-11-19
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RUNNING HEAD: Investment analysis1Project report
Investment analysis2Executive summary:Fundamental concepts are the best concept to identify the best stock in the market andit is also useful to analyze the various conditions and situation of the company. In this report, various tools of fundamental analysis such as bottom up analysis and top down analysis has been performed to identify and manage the performance of the country, industry as well as the firms. In this report, firstly the Australian market has been analyzed. In addition, the industry of banking has been evaluated and lastly the performance has been done over the two firms which are operating its business functioning under the industry of banking. More, various micro and macro factors have been analyzed for this report. Lastly, a summary of the report and a recommendation have been given to brief the investor about the situation of the company.
Investment analysis3ContentsIntroduction.......................................................................................................................4Company overview:..........................................................................................................4Top down analysis............................................................................................................4Banking industry of Australia.......................................................................................5Future projections.........................................................................................................6Inflation rate..................................................................................................................7GDP..............................................................................................................................8Fiscal policies...............................................................................................................9Bottom up analysis...........................................................................................................9Ratio analysis..............................................................................................................10ANZ Bank Australia...............................................................................................10Commonwealth bank Australia..............................................................................11DU Pont analysis........................................................................................................12ANZ Bank Australia...............................................................................................12Commonwealth bank Australia..............................................................................13Financial data analysis................................................................................................15ANZ bank Australia................................................................................................15Commonwealth bank Australia..............................................................................16Summary and recommendation......................................................................................17References.......................................................................................................................18
Investment analysis4Introduction:This entire study has been done to identify the opportunities for an investor into the Australian market. Through this study, it has been found that the Australian market is performing well in the current scenario. Various tools are available into the market to evaluate the best security into the market. In this report, fundamental analysis has been opted.Fundamental analysis is a study in which various stocks are evaluates on the basis of their worth in the market. For analyzing the worth, the final statements, industry situation, company situation, economical condition etc has been evaluated. Further, for the conduction of fundamental analysis, two methods of fundamental analysis have been evaluated. One is top down analysis and other one is technical analysis.In this report, various tools of fundamental analysis such as bottom up analysis and top down analysis has been performed to identify and manage the performance of the country, industry as well as the firms. In this report, firstly the Australian market has been analyzed. Further, banking industry has been evaluated for this report. and two firms of the industry which are commonwealth bank Australia and ANZ bank Australia has been taken into the consideration. In this report various aspect of the industry has been analyzed such as fiscal policies, inflation, GDP, economy performance, environmental condition, economical condition, ratio analysis, income statement, cash flow statement, ratio analysis, balance sheet analysis, DU Pont analysis etc has been evaluated (Sarsby, et al, 2014). Top down analysis:The top down analysis is the tool of fundamental analysis. In top down analysis, an industry and entire movements are analyzed which have taken place into the security market or the changes into the particular industry’s prospective rather than the individual security. This analysis mainly depends upon the assumption that an individual company of an industry cannot perform well if the industry in which company is operating, not performing well. Further, it has been found that this is totally opposite to the bottom up analysis. For analyzingthe best result through top down analysis, it is required for the analyst to make better situation. And for it, various tools must be analyzed in this report. Top down must be conducted according to the industry situation and the prospect of the company. So analyst must be aware about the situation of the industry (yasin, 2014).
Investment analysis5For preparing this report, banking industry has been taken into the context and further,the two firms of the company are commonwealth bank Australia and ANZ bank Australia (Seng & Hancock, 2012). Top down analysis has been done over both the companies of banking industry which are commonwealth bank Australia and ANZ bank Australia to make a better decision about the investment position of the company. In this report various aspect of the industry has been analyzed such as fiscal policies, inflation, GDP, economy performance, environmental condition, economical condition etc has been done (krnatz, 2016). This study has been conducted to identify the individual security performance in the banking and financial industry. Top down analysis express about entire aspects which are somehow related to the security such as the performance of the company, new policies and strategies adopted by the company, management strength of the company, operations and business functioning of the industry etc. this study has been performed for the investors so that they can make a better decision about the investment into the particular security. Banking industry of Australia:The Australian market is performing well in the market and the impact of better performance of the market is directly linked with the Australian banking industry. It has been evaluated that the banking industry’s growth is enhancing rapidly. Further, the last few years data have been analyzed of banking industry and it has been found that the banking industry is enhancing rapidly. Banking industry is enjoying a great experience in the market and thus the industry is a good option for the investors to invest their money (Nelson, Balakrishnan & Sidhu, 2012).
Investment analysis6(Analysis, 2017)The above table has also been evaluated and it has been found that the Australian banking industry is earning more profits than any other company worldwide. The Australian market has also left the China, UK, US etc countries behind and reaches on the top. Currently, the profits earned by the banking industry of Australia are 2.9% which is more than any other country’s profits. The performance of the banking industry depict about a better investment opportunity into the banking industry of Australia. Future projections:Further, the Australian market has been analyzed to identify the future changes of the industry as well as the performance of the industry. Through the reasrch over the banking industry, it has been found that the industry is performing super in current scenario and futureprospect of the industry is also depicting about a great industry situation. It has been evaluated that the risk and return of the industry is managing effectively through the companies and thus the industry would grow further rapidly (Zhang, Fonslow, Shan, Baek & Yates III, 2013). Currently, the Australian banking industry is on the top in terms of profits and the policies and strategies of the company are also in favor and so the industry’s performance and profitability would enhance in near future (Nelson, Balakrishnan & Sidhu, 2012).
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