Morrison and Marks And Spencer Essay Example

should check their intuition against modern financial analysis to avoid potential losses. Penman (2003: pp 3) warns that passive investors also face risks, such as overpaying or selling for less due to mispriced stocks.

Although economic and contemporary finance theory such as Bodie et al (2002) and Penman (2003) forecast that capital markets are flawless, it is still wise to conduct thorough research before taking any action - as cautioned by Penman (2003). As a result, both a passive and intuitive investor can be exposed to the risk of trading with a well-informed individual who has analysed every detail, highlighting the importance of in-depth research. This study aims to perform a comparative analysis of four retail companies based in the UK, and will place emphasis on aspects such as the macroeconomic environment, industry analysis, products, customers, strategy, finance and value. The ultimate goal is to provide investors with reasonable recommendations on which company's stock to buy, sell or hold. The following sections will be discussed in this paper: Section 2 analyses the macroeconomic environment supporting these companies. Section 3 scrutinizes the retail industry - the industry in which the four companies operate. Lastly, Section 4 studies each company through product analysis, customer review, employee management appraisal, corporate governance and an evaluation of their stock value.

Section 5 concludes by recommending to investors which company they should hold, buy, or sell, and also provides a methodology for valuing and appraising that method in comparison to other methods.