Business Analyzer Worksheet

Name of Business: General Motor Company (GM)

1. Does the company have an identifiable durable competitive advantage?
If yes, describe it in as simple a manner as you can.

1. Pass / Fail

Yes, General Motors owns many car brands such as GMC and Chevy being the top. These cars are know
to last long, have great quality, and be very stylish.

2. Do you understand how the business product/service works?

If yes, describe how the product/service works.

2. Pass / Fail

Yes, GM produces and distributes multiple different automobile brands. They are extremely effective at
this.

3. Will the businesss product/service be obsolete in 20 years?

If no, explain why the product/service will not be obsolete in 20 years.

3. Pass / Fail

No, be around. They own so many huge names in the automobile industry that is hard to even imagine
them going out of production. They will continue to be atop of the car business for many more years to
come.

4. What is the companys per share earning history and growth rate?
(Finding Information on morningstar.com)
EPS (Earnings Per Share) --- Type Ticker Symbol in Get QuoteFinancials
Year

2006

2007

EPS

2008
53.47

2009

2010

2011

2012

2013

2014

2015

113.18

2.89

4.58

2.92

2.38

1.65

5.91

Has companys EPS consistently gone up each year? ___no___

If not, was the weakness a one-time event? ___no___

4. Pass / Fail

5. Is the company consistently earning a high return on equity?

(Finding Information on morningstar.com)
ROE for past ten years --- Key Ratios (will only show last 5 years)
Year

2006

2007

2008

2009

2010

2011

2012

2013

2014

2015

Business Analyzer Worksheet

Return on
Equity

19.85 28.35

5 -Year Average Return on Equity ___31.514%_____

/ Fail

18.14

11.54

7.48

25.72

Higher than 15%? _____Yes__ 5. Pass

6. Does the company have a lot of debt?

6. Pass / Fail
Long-term debt in the current year of the business / Total net earnings in the current year of the business
____35,601,000________________
___3.6____________

______9,687,000______________ =

Long term debt should not be more than five times current net earnings
(Finding Information on morningstar.com)
Long Term Debt ---Financials - Balance Sheet --- (Click Annual tab at top; Look at
current year)
Total Net Income ---Financials - Income Statement (Click Annual tab at top; Look
at current year)
7. Is the company free to raise prices with inflation?

7. Pass / Fail

If the price of the product has risen on an average of at least 4% a year over the last twenty years, then
you can bet the farm that its the kind of business that can raise prices along with inflation.
8. Are large capital expenditures required to update plant and equipment?
(Does the product/service require expensive changes or upgrades?)

8. Pass / Fail

Price Analysis
9. Is the companys stock price suffering from a market panic, a business recession, or an individual
calamity that is curable?
9. Pass / Fail

10. Use this formula to determine if the business is undervalued, fair valued, or overvalued.
P/E Ratio (Price / Earnings) / 5-Year Annual Avg. of Net Income =
___4.7_______

_____13.0_____

_____.36_____

0 1 = Company is undervalued
10. Undervalued/Fair value/Overvalued
1 2 = Company is fair valued
2 3 = Company if overvalued
(Finding Information on money.msn.com/)
P/E Ratio --- Valuation Price/Earnings (1st Column)
Net Income 5 Year Average ---Valuation Price/Earnings (4th Column)

Business Scorecard:

Business Analyzer Worksheet

#1

#2

#3

#4

#5

Competitiv
e
Advantage

Understan
d
Business

Product/Servic
e
Obsolete in
20 years

Earnings
Per Share
(EPS)

Return
on
Equity
(ROE)

#6

#7

#8

Free to
Raise
Prices

Large
Cap. Exp
Needed

Debt

Pass

Pass

Pass

Pass

Pass

Fail

Fail

Fail

Fail

Fail

#9

#10

On Sale

Valuation

Pass

Pass

Pass

Pass

Undervalue
d
Fair valued

Fail

Fail

Fail

Fail
Overvalued