FIN205_Assessment 2_

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Charles Darwin University *

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205

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Finance

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Jun 18, 2024

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FIN 205/510 Assignment Marks: 30 (15% weight of total assessment) Problem 1: Choose a publicly traded company from the Australian Securities Exchange (ASX). Write about the company, its product, and services, the size of the board of directors, the name of the CEO, year of establishment of the business, and provide the following information about your chosen company. 02 Marks Company Name: Orica Limited Stock Ticker Symbol: ORI Stock Information: Orica have 11 directors/senior management: Chairmen, Managing Director/CEO, 7 Non- Executive Directors, CFO and Investor Relations. The CEO Sanjeev Gandhi is also the managing director. The business was first listed on 28 th November 1961. The company was initially found in 1874. Most recent price $16.110 Market capitalization $7.20B Daily volume 856,381 Number of ordinary securities published on ASX 455,491,558 Most recent dividend $0.180 Annual dividend yield 2.53% P/E ratio 26.01 EPS $0.607 Company Description: Orica is the largest provider of commercial explosives and blasting systems to the mining and infrastructure markets, the global leader in the provision of ground support in mining and tunnelling, and the leading supplier of sodium cyanide for gold extraction. How to answer this question? Choose a company from the link below. https://www.asx.com.au/asx/research/listedCompanies.do Click on the Key statistics and note them down as required in question 1. Problem 2: Find the beta of the stock from 30 June 2018 – 31 July 2023 (download daily price

information) from yahoo finance and write a summary of your analysis indicating the stock price trend during the analysis period. 05 Marks How to answer this question? Steps in downloading stock price from https://au.finance.yahoo.com/ a. Type the name of your chosen company in yahoo finance search option b. Click on the historical data. c. Choose time for 5 years of data (for example (30 June 2018 – 31 July 2023) period. d. Show historical price, Frequency: daily e. Download the excel spreadsheet with data and save it. f. Keep date and Adj closing price columns and delete open, high, low, and volume columns. Orica has a steady trend for most of the 2019 Financial Year., starting at 17.68 and closing at 20.27. The largest increase came on the 9 th of May where the share price increase by $1.05. This was a 5.6% increase on its price. The price kept increase for the start of the 2020 FY where ORI hit its highest share in this period of $24.24. However, this trend did not continue for long as the share price dropped to $14.2 in March 2020. The Price has slowly and unevenly climbed up since that time where it now remains at $15.75 (as of the 31 st of July 2023).

g. Now you can find ASX 200 index data here https://au.investing.com/indices/aus-200-historical-data h. Download the ASX 200 index data and only choose Adj closing price. Copy Adj closing price and past it next to your chosen company’s stock price. Follow the above two videos to collect data for your chosen company and ASX 200 index. https://www.youtube.com/watch?v=Byx4hQ0IRrM&t=276s i. Now arrange the data in 3 columns in you excel file. Column 1 (date), column 2 (your chosen company’s adjusted closing price, ASX200 adjusted closing price. Now select the data in 3 columns and click data icon in you excel sheet and then click Z to A arrow sign to arrange data from 2023 to 2018 period. j. Now compute returns (returnt = (Pt – Pt-1)/Pt-1 ) of the chosen stock and ASX 200 index for the stated (daily data) period. Variables Your chosen company (30 June 2018 – 31 July 2023) ASX 200 (30 June 2018 – 31 July 2023) Return (most recent period) 0.508% -28 th July Return -0.092% -28 th July Return Mean (average returns) 0.0154% -0.0080% Variance 0.000306 0.000124 Standard Deviation 0.017501 0.011126 *Slope (Beta) 0.960836 *Slope = covariance (returns of X company, returns of ASX 200)/ variance of ASX returns. You can either type (=slope (return of X, Returns of ASX 200) in excel or the above slope formula. J. Now calculate beta by regressing the share's returns on the returns to the index chosen. Report both excel results and regression result with beta. Your calculated slope and beta will be exactly the same. Copy the regression table from the excel sheet and paste it on your assignment word file. For regression analysis, you have to use the analysis tool pack available in excel.

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