Mary Seacole Stock Performance and Recommendation Report
Essay Preview: Mary Seacole Stock Performance and Recommendation Report
Report this essay
MARY SEACOLE STOCK PERFORMANCE AND RECOMMENDATION REPORTPrepared forMary SeacoleHalifax, Nova ScotiaPrepared byKieren Yu Financial Analyst AssistantMelmoth Financial GroupHalifax, Nova ScotiaDecember 3, 2018TABLE OF CONTENTSPageEXECUTIVE SUMMARY 4INTRODUCTION 5Purpose 5Scope & Limitations 5Background 5Methods 5Key Terms 6FINDINGS & DISCUSSION 6Industrials 8Air Canada (AC.B) 8Bombardier Inc. CI B (BBD.B) 9WestJet Airlines Ltd. (WJA) 9Telecommunications 9BCE Inc. (BCE) 10Rogers Communications Inc. (RCI.B) 10TELUS Corp. (T) 11CONCLUSIONS 11RECOMMENDATIONS 12REFERENCES 13LIST OF ILLUSTRATIONSTABLESWeekly Values of Mary Seacole’s Stock and of the S&P/TSX Composite Index 7FIGUESWeekly % Change of Mary Seacoles Total Portfolio Value vs. Weekly % Change of the S&P/TSX Composite Index 7Weekly % Change of Mary Seacoles Total Industrials Value vs. Weekly % Change of the S&P/TSX Composite Index 8Weekly % Change of Mary Seacoles Total Telecommunications Value vs. Weekly % Change of the S&P/TSX Composite Index 10EXECUTIVE SUMMARYThis analytical report is to summarize Mary Seacole’s portfolio performance, inform her of the industry and company news associated with the portfolio, and offer her effective recommendation on the additional 200-share investment. With our continuous researches about Seacole’s portfolio, some findings are accumulated in order for Seacole to make final decisions about her future 200 shares investment.Key FindingsOver the course between September 18 and November 6, there was a recession in the market, as the downward-sloping tendency in the S&P/TSX Composite Index shows.Industrials performed much worse than telecommunications. The eight-week period witnessed drastic decreases by 31.19% and 6.09% in stock prices of Bombardier and WestJet respectively. Compared with industrials, telecommunications stocks displayed milder declines: the stock price of TELUS fell by 7.49%; BCE Inc.’s price surprisingly increased by 2.03%, and that of Rogers only dropped by 2.96%.
It is noticeable that Air Canada, Bombardier, and TELUS shared a pretty similar downward trend—their prices all fell continuously over the period in spite of a few recoveries. However, the pattern was different with WestJet and BCE whose prices fluctuated. As for Rogers Communications, its share price suddenly declined to only $65.31 on October 2. Nevertheless, it experienced a gradual recovery to $67.95 at the end of the period. ConclusionsThe Industrials sector was highly affected by the market dynamics, while the telecommunications industry was less sensitive to market changes. That is to say, facing the rising costs of raw materials including petroleum triggered by the international trade disputes, Air Canada, WestJet, and Bombardier’s share prices went down. However, trade turmoil did not shock telecommunications too much because of the technological revolution in the industry, namely the research and development of 5G made the industry more prosperous. RecommendationsMore shares of telecommunications should be purchased, because of the lower risks and expected long-term growthMore shares of Bombardier should be invested. Its share price was overestimated, though it is the most money-losing stock in the portfolioFor portfolio diversification, other industries should be considered for buying as additional investmentMARY SEACOLE STOCK PERFORMANCE AND RECOMMENDATION REPORTAt the request of Ms. Mary Seacole and on behalf of Melmoth Financial Group, this analytical report evaluates the historical performance of Mary Seacole’s portfolio, which includes six stocks: Air Canada, Bombardier Inc. CI B, and WestJet Airlines Ltd. from industrials as well as BCE Inc., Rogers Communication Inc., and TELUS Corp. from telecommunications. In accordance with Ms. Mary Seacole’s request to invest 200 shares more on her portfolio, this report is created to provide Ms. Seacole with details of the eight-week performance of her portfolio and a professional analysis of each stock’s fluctuation. It also gives Ms. Seacole recommendations on which stock to invest it further, on the basis of dependable information of relevant industries. Scope and LimitationsThe ups and downs of share price, to a great extent, rely on investors’ expectations towards the broad market, industries, and companies. “There is no way to predict the price of stocks and bonds over the next few days or weeks” (“The Prize in Economic,” 2013, para. 1). Ms. Seacole’s portfolio was monitored for only eight weeks. Therefore, the overall performance of each stock and the S&P/TSX Composite Index cannot be fully assessed in spite of some reliable industrial news and information as references. Furthermore, press releases are usually regarded as indicators to predict a long-term fluctuation of stocks; therefore, some errors might appear if using this method to forecast short-term price variations.BackgroundMary Seacole became Melmoth Financial Group’s client in September this year and authorized Melmoth Financial Group to purchase 600 shares of stock for her. Based on Seacole’s requirement, six stocks were purchased on September 18, 2018. As her investment advisor, I recorded these stocks’ performance over the eight-week period (from September 18 to November 6) and conducted research aiming at her portfolio. On November 7, Ms. Seacole intended to increase her investment by 200 shares and asked for recommendations on her follow-on investment.