Prepare a financial plan for the same Fortune 500 Company you selected in weeks two and four. This financial plan will be included in your final business plan in your capstone course.
Describe the organization, including the type of business.
Create the business case.
· Determine why funding is needed for the company.
· Determine the sources of funding. Consider self-funding, borrowing, loans, equity, venture capital, etc.
· Evaluate the requirements of each of the funding sources that you plan to use.
· Analyze the risks that are associated with each funding source.
· Decide which sources are the best fit for your company based on the requirements of each. Justify your decision.
· Estimate the cost of capital for both short-term and long-term funding sources. Research current estimated APRs for your selected sources of funding. Create a table or chart to display this information.
Estimate direct costs, including capital, marketing, labor, equipment, and inventory/supply costs.
Prepare a budget that includes starting balances, monthly costs, loan/investment payments, cash flow projections, and required revenue.
Create a profit-and-loss statement (income statement) for a 3-year period (2022, 2023, and 2024). Provide a revenue forecast, stating realistic assumptions, such as growth per year, in your projections. Refer to Table 18.1, Table 18.2, and Spreadsheet 18.1 in chapter eighteen.
Running Head: SHAREHOLDER ANALYSIS 1
SHAREHOLDER ANALYSIS 2
Performing a stakeholder analysis is a great way to deliver a high-quality product. It helps in understanding various stakeholders of the product and to what extent they can affect the project. A stakeholder analysis uncovers and removes multiple barriers in understanding the project progression. The information provided below will illustrate Toyota’s shareholder analysis.
Toyota is a leading player in the global automotive industry. Toyota has exploited opportunities and addresses threats in its macro-environment. Toyota is subject to the effects of political conditions. Toyota enjoys political stability in significant markets. Moreover, the presence of free trade agreements and governmental support for eco-friendly products. These are opportunities that the corporation wants. Toyota has the opportunity to improve its exports from Japan based on the weaknesses of the Japanese Yen. Toyota has the opportunities to grow its businesses in the U.S., the firm’s second-biggest market after Japan. Additionally, the rapid growth of developing economies presents the opportunity for the firm to improve revenues based on the needs. The main economic factors create opportunities for business growth (Ferguson, 2017).
Toyota has the opportunity to provide more products that satisfy customers’ increasing interest in hybrid and electric vehicles. However, the company must consider the widening wealth gap, which is a threat as it corresponds to a declining middle class. The middle class is the primary revenue source of Toyota. The external social factor of the widening wealth gap is a significant concern. Toyota has the opportunity to improve its e-commerce capabilities or to exploit third-party e-commerce service providers for the sale of some of its products, such as spare parts. Moreover, Toyota has the opportunity to enhance its mobile apps to increase customer engagement and loyalty. However, the company must address the threat of cybercrime (Ferguson, 2017).
Toyota has the opportunity to grow with reduced concerns for infringement of its intellectual property rights because governments are working toward improving intellectual property protection. Toyota has the opportunity to provide higher quality products that satisfy or exceed requirements based on environmental laws. Additionally, the company can exploit the possibility of offering safer and more satisfactory products to fulfill consumer laws. Toyota has opportunities to provide environmentally friendly products such as cars with higher fuel efficiency. The company has the opportunity to increase its sustainability performance through improvements in business process efficiency (Macrotrends, n.d).
Although markets have progressed steadily for the automobile industry in the developed countries and expanded in China due to the effects of a sales tax on smaller cars, markets in countries rich in resources have slowed down. Meanwhile, efforts toward improvement across businesses in automated driving technology, connected vehicles, environmental technologies used in fuel cell vehicles, and ride-sharing have become active. Reviewing the general economic environment for the year 2017, concerning the world economy, the U.S economy has seen ongoing recovery due to increasing personal consumption owing to improvements in employment and income conditions, and the European economy has continued its moderate recovery. Meanwhile, weaknesses have been seen in some emerging countries. The Japanese economy has been on an average recovery due to improvements in employment and income conditions (Toyota Global 2017).
Macrotrends (n.d). Toyota Financial Ratios for the Analysis 2005-2021 | TM. Retrieved from < https://www.macrotrends.net/stocks/charts/TM/toyota/financial-ratios>
Toyota Global (2017). Financial Summary FY2017- Toyota Motor Corporation. Retrieved from < https://www.toyota-global.com/pages/contents/investors/financial_result/2017/pdf/q4/summary.pdf>
Toyota Motor corporation
19 Apr 2021
THE COMPANY AND TICKER SYMBOL
Company Name: Toyota Motor Corporation
Ticker Symbol: (TM)
Toyota Motor Corporation is a Japanese multinational automotive manufacturer headquartered in Toyota, Aichi, Japan. The company strives to be a strong corporate citizen, engaging with and earning the trust of its stakeholders, and contribute to the creation of a prosperous society through all its business operations. Their corporate principles form the basis of the initiatives, reflect values that enable action and drive out mindset. A ticker symbol is also known as a stock symbol. It is an arrangement of letters representing publicly traded securities in an exchange (Renström & Bentsson 2021). Toyota Motor Corporation Ticker symbol is (TM).
Cash flow from operations
|Cash flow from operations|
|Net income from continuing operations||$ 2,142,329,000|
|Operating gain losses||$ -198,540,000|
|Depreciation Amortization Depletion||$ 1,605,383,000|
|Deferred tax||$ 192,147,000|
|Provision & Write-off of assets||$ 142,982,000|
|unrealized gain loss on investment securities||$ 20,082,000|
|change in working capital||$ -313,740,000|
|cash flow from operations||$ 3,590,643,000|
Cash flow from operating activities indicates the amount of money a corporation brings in from its regular business activities such as manufacturing and selling goods. In the cash flow from operations for Toyota Motor Corporation, there are various transactions that have been highlighted above. The total cash flow from operations in the financial year ended 2020 was $3,590,643,000 (TM, 2021).
Price to earning ratio as at December 16, 2020: 15.78
Stock Dividend as at September 29, 2020: $1.793
Earnings per share is as follows:
|Earnings per share||EPS||$11.73|
Price to earning ratio indicates the dollar amount an investor can expect to invest in a corporation to receive one dollar of that company’s earnings. Stock dividend is a dividend payment to shareholders that is made in shares rather than cash. A company’s earnings per share is a company’s net profit divided by the number of common shares it has outstanding. It indicates how much money a company makes for each share of its stock and is widely used metric to estimate corporate value (TM, 2021).
Revenue estimation involves calculating the amount of money the business is likely to earn. The revenue estimates are from July 1, 2021 to April 31, 2022 (Finbox, 2021).
|March 2020||March 2019||March 2018|
|Revenues||$ 29,929,992,000||$ 30,215,681,000||$ 29,379,510,000|
The information provided above indicates the revenues generated by Toyota Motor Company for the years 2020. 2019 and 2018 (TM, 2021). The revenues are as a result of sale of cars.
Statement of cashflows
|Statement of cashflows|
|Operating cash flow||$ 3,590,643,000||$ 3,766,597,000||$ 4,210,009,000|
|investing cash flow||$ -3,150,861,000||$ -2,697,241,000||$ 3,660,092,000|
|financing cash flow||$ 397,138,000||$ -540,839,000||$ -449,135,000|
|End cash position||$ 4,412,190,000||$ 3,706,515,000||$ 3,052,269,000|
A statement of cashflows indicates the movement of cash in various fields in an organization. Cash is divided into financing activities, operating activities and investing activities (TM, 2021).
Average Trade volume
The Average volume for Toyota Motor Group is 370,509.
Average trading volume is the average number of shares traded within a day in a given stock. Daily volume is how many shares are traded each day, but this can be averaged over a number of days to find the average daily volume (Jianjun & Juncheng 2018).
Current stock Price: 157.57
52-week high: 163.37
1-Year estimated stock price: 178.76
The stock prices are used to reflect the potential and future viability, it is also used to determine the management compensation (Jianjun & Juncheng 2018).
The recommendation to any investor based on Toyota Motor company stock prices is to hold.
The current analyst and expert consensus on Toyota is hold, with 0 strong buy and 0 strong sell opinions. The current projected Toyota target price consensus is 122.94 with two analyst opinions. The most common way Toyota Motor company analysts use to provide recommendation to the public is financial statement analysis (Jianjun & Juncheng 2018).
The market cap for Toyota Motor Corporation as at 2020 is 219.413 billion.
Market capitalization refers to the total dollar amount of a company’s outstanding shares of stock. It can also be said to be a company’s worth as determined by the stock market. It is derived by multiplying the number of outstanding shares by the current market value of one share.
TM (2021). Toyota Motor Corporation. Retreived from https://finance.yahoo.com/quote/TM/
Finbox (2021). Toyota Motor Corporation- Financials. Retrieved from https://finbox.com/NYSE:TM/charts
Renström, J., & Bentsson, L. (2021). A team-based management approach for Lean development: Effects on efficiency and wellness.
Jianjun, L., & Juncheng, L. (2018). Infrastructure Construction of the Belt and Road, Economic Development and Financial Elements. Studies of International Finance, 02.