MBA 630 - Spreadsheet assignment and Regression

We will use Excel data from Coltec and Archer Daniels Midland companies for regression analysis. Data for this project will be found on Blackboard. Questions to answer: 1) Run the simple regression for Coltec: a. Predict income (Y) based on sales. b. What is the success of the model? 2) Run simple and multiple regressions for Archer Daniels Midland: a. Predict income based on sales b. Predict income based on sales and depreciation c. Predict next quarters stock price based on sales and income d. What is the success of these models? Are the predictions reasonable? (Determine success by evaluating: R2, P-value, direction of coefficients for a more detailed explanation of these values than is given in our textbook, you may wish to refer to an outside source. One that is given on the web is as follows: http://dss.princeton.edu/online_help/analysis/interpreting_regression.htm ) 3) Also perform a ratio analysis using the data that is given on Sheet 2 of the Excel workbook. Use at least three different ratios: a. liquidity ratio such as: i. current assets / current liabilities; ii. cash flow from operations / current liabilities b. leverage (or debt) ratio such as: i. total liabilities / total assets; ii. total liabilities / total equity c. profitability ratio such as net income / sales (from the 1st spreadsheet page) d. What do the results of the regression models and the ratio analysis show about: the performance of the company in terms of trends over time, and the health (strengths and weaknesses), in terms of the results of specific financial ratios, for each company? 4) Select a company of your choice. Find the financial data and: a. Complete a regression analysis of your choice. Complete the regression analysis using JMP. In your regression use at least 5 years of data if you are using annual data; if you are using quarterly data, use at least 8 quarters. Explain your choice and your solution. b. Perform a financial analysis similar to the one you did in part 3. Compare and contrast your company to the other two companies in the project. 5) Present these requirements in a report that is produced as a Word document. Incorporate the regression and ratio analysis results within the Word document where needed. To do this, you can either: - paste the JMP data output within the Word document as you explain it, or - Include the JMP data output as tables at the end of the report, but if you do that you must still explain the results within your Word document by referring to the numbered tables. Do not just attach the data to the end and assume that I will put it together myself. Also do not print or send me separate attachments of the Word document and the data output for this assignment. Everything should be included all within Word.