WC Paper
Joe Finnerty
Cosmo Rizzo
Luca Aufiero
3 November 2014
Working Capital Project: Analysis of Banking and Airline Industry
In this research project, we are evaluating two sectors from an analysis of the financial statements of five companies from each sector. One of the sectors that we will be analyzing is the financial sector. Under this sector, we are focusing on commercial banking. The top five companies for our analysis are J.P. Morgan Chase, Bank of America, Citigroup, Wells Fargo, and Goldman Sachs. The criterion in choosing these companies is U.S. based firms ranked by the highest revenues in 2013. An important distinction that sets this industry apart from others is the heavily involvement of the government. For example, the Federal Reserve sets borrowing limits, interest rates, and how much deposits in a vault are to be held. The government has great authority, especially with fluctuations of interest rates, in the profitability of the financial sector. These banking institutions are currently regulated at the highest degree since the financial crisis of 2008. The second sector we will analyze is the airline industry. An airline is a company that provides air transport services for traveling passengers and freight. Airlines either lease or own their aircrafts that they supply these services with. Airlines take passengers across the world servicing everyone from business passengers, tourists, and business entities that use services for commerce of products. The airline industry is a service industry which is structured based on the service the airline provides, what the airline is in business to transport, and the revenue potential of the particular airline.
We will start with the analysis of the banking industry in regards to the companies we have chosen to look at. The analysis of this particular sector requires some consideration, prior to the evaluation of financial statements, because of its unique characteristics. First off, the banking
Cosmo Rizzo
Luca Aufiero
3 November 2014
Working Capital Project: Analysis of Banking and Airline Industry
In this research project, we are evaluating two sectors from an analysis of the financial statements of five companies from each sector. One of the sectors that we will be analyzing is the financial sector. Under this sector, we are focusing on commercial banking. The top five companies for our analysis are J.P. Morgan Chase, Bank of America, Citigroup, Wells Fargo, and Goldman Sachs. The criterion in choosing these companies is U.S. based firms ranked by the highest revenues in 2013. An important distinction that sets this industry apart from others is the heavily involvement of the government. For example, the Federal Reserve sets borrowing limits, interest rates, and how much deposits in a vault are to be held. The government has great authority, especially with fluctuations of interest rates, in the profitability of the financial sector. These banking institutions are currently regulated at the highest degree since the financial crisis of 2008. The second sector we will analyze is the airline industry. An airline is a company that provides air transport services for traveling passengers and freight. Airlines either lease or own their aircrafts that they supply these services with. Airlines take passengers across the world servicing everyone from business passengers, tourists, and business entities that use services for commerce of products. The airline industry is a service industry which is structured based on the service the airline provides, what the airline is in business to transport, and the revenue potential of the particular airline.
We will start with the analysis of the banking industry in regards to the companies we have chosen to look at. The analysis of this particular sector requires some consideration, prior to the evaluation of financial statements, because of its unique characteristics. First off, the banking