Question

Assignment Directions For this project, you will be researching the oil sector. Using the Internet, research two companies in the oil and gas industry, obtaining information on their publicly reported financial statements to evaluate their financial leverage and make a decision to buy or sell the stock. Obtain the following metrics by using information from their most recent financial statements: Total Assets/Total Liabilities Total Current Assets/Total Current Liabilities Debt/Total Capital ROI or return on investment (presented as a value per share, such as $2.50 Submission Requirements Once you have completed your research, performed the ratio calculations, and made a decision on selling or buying the stock, write a narrative, as if you were advising a client. This narrative must be at least two paragraphs long. The format is to include descriptive information for the companies researched at the top, followed by the ratios, and then the narrative. Extra points will be given for including an original graph. The report can be double-spaced with 1-inch margins and should not exceed two pages

Answer 1

Title: Oil Sector Analysis - Stock Recommendation for [Company A] and [Company B]

Company A: [Name of the First Company]

Provide a brief introduction to the first company, including its name, industry position, and key operations.

Company B: [Name of the Second Company]

Provide a brief introduction to the second company, including its name, industry position, and key operations.

Financial Ratios:

Total Assets/Total Liabilities: Calculate and present the ratio for both companies.

Total Current Assets/Total Current Liabilities: Calculate and present the ratio for both companies.

Debt/Total Capital: Calculate and present the ratio for both companies.

ROI (Return on Investment) Per Share: Calculate and present the ROI per share for both companies.

Stock Recommendation:

Based on the financial ratios and your analysis, make a recommendation for each company's stock. Should your client buy, sell, or hold these stocks? Provide reasons for your recommendation.

Narrative:

In the narrative section, elaborate on the reasons behind your stock recommendations. Discuss how the financial ratios you calculated influenced your decision. Consider factors such as financial leverage, liquidity, and return on investment. Mention any notable trends or patterns you observed in the financial statements.

Explain any potential risks or opportunities in the oil sector that might affect these companies.

Compare and contrast the financial health and prospects of the two companies to justify your recommendations.

Conclude with a summary of your overall analysis and recommendations.

Graph (Optional):

If you have created an original graph to illustrate key financial trends or ratios, include it in the report to enhance your presentation.

Submission Requirements:

Ensure that your report is double-spaced with 1-inch margins.

Limit the report to not exceed two pages, excluding the optional graph.

Make sure the report is well-structured and easy to read.

By following this structure, you'll be able to provide a clear and informative analysis for your client based on your research into the oil sector and the financial performance of the selected companies.