Financial Statement Analysis


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"Credit decision for Southwest Airlines Document Preview: Research ProjectOBJECTIVEThe specific objective of this graded written research exercise is to prepare an ""executive level financial report"" to the Chief Financial Officer (CFO) of a mythical company in which you are employed as a financial analyst. This report will pertain to the financial evaluation of a real, publicly-traded, company. It will require independent research (web-based or library), careful financial analysis, and the proper application of key financial theories and formulas.SITUATION You are a financial analyst with the mythical RenDi corporation. RenDi is a manufacturer of renewable synthetic diesel fuel. One of the emerging markets for this product is in ground support equipment (GSE) for the airline industry. A competitive technical and economic product evaluation has determined that Southwest Airlines (LUV), (a real publicly-traded company) is the best potential partner. The partnership entails an agreement that will allow Southwest to purchase renewable synthetic diesel at fixed rates for 5 years while RenDi studies the environmental costs/benefits of converting GSE to renewable fuel. RenDi would absorb all conversion costs for the GSE fleet of Southwest Airlines. Based upon some serious concerns about the stability of companies in the airline industry, the CEO has asked your CFO to conduct a financial analysis of Southwest Airlines to determine if it is prudent to commit to a 5 year contract with this company. The cost of converting over to renewable synthetic diesel fuel is significant and any interruption in the agreement during the next few years would adversly affect RenDi's performance and profit. Specifically, the question is: will Southwest Airlines be financially viable over hte next two to three years? YOUR SPECIFIC ASSIGNMENT Your specific assignment is to research, analyze, and prepare a report for the CFO on the actual financial performance of Southwest Airlines for the years 2009, 2010, and 2011. In addition to reviewing the... Attachments: Research-Proj....docx"


Solution ID:565829 | This paper was updated on 26-Nov-2015

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