HND金融专业GU3报告第一篇-第一部分(Planning)

Planning
1.1Companies selected for project
I chose Land Securities Real Estate Investment Trust (LAND.L), Liberty International Real Estate Investment Trust (LII.L), British American Tobacco (BATS.L) and Shire Pharmaceuticals Group Plc (SHP.L) as my shares portfolio. Both LAND.L and LII.L are in Real Estate Investment Trust diversified sector. BATS.L is the first range harvester, producer and distributor of tobacco in the world. While, SHP.L is the leading specialty biopharmaceutical company that focuses on meeting the needs of the specialist physician.
1.2 Justification for choices
I chose LAND.L as one of my investment company, because it is indeed one of the biggest owners in cities, which has a huge amount of real estate all over the UK. Its famous and welcome retail brand is the biggest invisible capital. In addition, it has now generated compound annual growth of 14.6% since 2004. General speaking, only keeping an appropriate risk management and reducing unnecessary cost on administration and distribution, can company keep higher turnover increase. Consequently, I believe along with the changes and evolution, the three businesses of Land Securities-Retail, London, and Trillium, will be in good shape and it will provide the platform for future revenue and earnings growth. On the other hand, from his financial report, Land securities have low potential risks of its debt-load. They maintain an appropriate debt to equity ratio (42%) to ensure that asset level performance is translated into returns for shareholders. As far as my opinion, I have much confidence to make sure that the company will have bright future in his business.
For SHP.L, it has high-potential to develop. Shire has enough financial support and specialist physician to manufacture new medicine product portfolio in challenging diseases. In HIV infection and AIDS treatment, there are few competitive pressures and minority entrants. This external surrounding will bring many opportunities for Shire. Furthermore, Shire also has a strategic focusing on treatment for HIV and gastrointestinal diseases therapies since 2006. Many physician experts expect that the nucleoside analogue market needs for HIV has continued to grow in 2009. Shire’s product portfolio in HIV, gastrointestinal diseases will continue to deliver strong, high margin growth throughout 2009 and 2010. Thereby, I believe the good forecast will bring more income and yield benefits for Shire in biopharmaceuticals. The shareholders will also obtain quite a few dividends from the considerable income coming from these projects in the future.
Based on the continued positive share trend and financial analyze, the quick ratio of British American Tobacco is approximate 0.89. This is good indication for investors, which reflect the BATS.L has efficiently using its current assets. All asset of BATS.L are quickly convertible into cash, and to divide the result by all current liabilities. It specifically excludes inventory. In profit ability, the
return on capital employed ratios keep high single-digit growth in average 3 year (2007:22% ,2006:21% , 2005:19%), which shows the British American Tobacco maintains a well level on utilized its resources in generating profit and shareholder value. The long-term profitability of BATS.L is also keeping high-quality growth. The British American Tobacco has delivered the average earnings per share (EPS) growth of 10 per cent over the last three years. Basic earnings per share for 2007 were 105.19p (2006: 92.08p).It is vital for both the company as well as the benefit received by shareholders. Accordingly, from above ratio and statistic, I think the British American Tobacco can maintain a preferable performance in the following year and the stock price will keep steady growth in 2009.
To consider all advantages of LII.L, I am sure that this company will have better performance in 2009. At first, Liberty International is a new market leader in large scale shopping centers and the owner of other prime retail assets. His gross retail income keeps higher increase in recent decade. Compare with other competitors, Liberty International was build up in 1987 and was listing in London Stock Exchange in 1992. Along with market needs start raise, its capital structure become more stable and they begin to extension its business. His productions begin from single, costliness to diverse and low price. They being periodically pay dividend, the share’s price of Liberty International keep relative high level. Therefore, Liberty International belongs to the rapidly accelerating industry growth in industry life cycle. Contrast with some deceleration industry and mature industry, the Liberty International shares price have more development potential and large space to increase. Secondly, the investment expert indicates merging the Capco Urban business unit is high yield indirect investment for Liberty International. After merged Capco, Liberty International can satisfy his development needs and oversee and implement large scale development projects. This implies significant value will be created from initial investment. The Liberty International will gain considerable income in these areas in the future and the shareholders will also obtain quite a few dividends. Therefore, investing LII.L is a wise choice in 2009.
1.3 Method and sources to the project
Fundamental analysis and technical analysis are used in this program, which can help me to finish this project.
For fundamental analysis methods, it helps me chose appropriate shares at suitable time with the appropriate price. First, I collect financial report for each company, and then I calculate the different statistics and ratios to analysis the company performance in the last year. Through comparison, I decide the final share portfolio. At the same time, I use industry analysis to help me understand the industry developing situation over this period. I also adopt qualitative analysis and quantitative analysis to analyze the economic environment, interest rate, inflation, monetary policy, as well as foreign exchange rate.
For technical analysis, some line charts and bar charts can show the uptrend and downtrend directly, which gives me some useful information. For example, Dow Theory and K theory told me the big movement of the each share. I always based on day-to-day statistic to catch effective information and forecast the short-term trend.
In order to finish this homework, I also use primary sources. I record the market price for each share, sector index, FTSE 100, all share indices in the website every weekly. I also go to the company homepage to investigate the main business for each company. In addition, I also analyze the nationally and internationally factors, which would influence the shares fluctuation.
At the same time, it is sensible to use secondary sources. It gives me abundance of useful information. It was collected mainly from company annual reports, including Chinese and English editions, archival materials in magazines, newspapers and websites. Some times I collect useful information coming from investment expert advises on websites and TV. I choose these kinds of sources, because it can provide large amounts of information quickly, low costs, considerably effective, and reduce the overall time.
1.4 Plan for carrying out project
The whole project including three parts: planning, developing and evaluating. I should use more than four months to finish this report. Look at the below table, which displays the plan for carrying out this project.。