Question

Select a stock in the S&P 500 and do a complete risk assessment of the firm using the Porters Five Forces framework. Address each force individually and provide factual information to back up your claims. There is extensive data on Bloomberg, company filings, articles, etc. I expect a respectable amount of effort on this, but nothing over the top.

Answer 1

Introduction:-

The S&P 500 has added $2.04 trillion in market value since Trump's election last November through Monday, according to Howard Silverblatt, senior Index analyst at S&P Dow Jones Indices. The benchmark rose to a record on Monday and then another in early trading Tuesday.

A key component of Trump's tax reform plan is to let companies bring overseas profits to the U.S. without paying the 35 percent U.S. corporate tax rate. Companies like Microsoft, Apple and Google-parent Alphabet have billions of dollars parked overseas and a lower tax rate could incentivize them to bring that money back to the U.S.

Tech is up nearly 30 percent since the election, and has also added $1.019 trillion in value to the S&P in the time period, the most out of any sector, S&P Dow Jones' Silverblatt told CNBC in an email.

But tax reform hopes have fluctuated as the administration has faced several hurdles trying to move its agenda forward, including in-party fighting.

"People are in wait-and-see mode in terms of tax reform. We get a bit of a pop every time it gets mentioned, but I think the market is in a bit of disbelief," said Robert Pavlik, chief market strategist at Boston Private.

For Suppliers:

In the case of a financial news firm, the supplier side could include journalists, professional experts and analysts. Just one of Bloomberg’s media products, Bloomberg News, enjoys a worldwide network of almost 500 journalists who are engaged in producing more than 3,000 business stories each day. These are written in five different languages from more than 50 news bureaus across the globe. The bargaining power of suppliers could be low because working with Bloomberg is ideal for any analyst and a much sought after post, so this may not give him an undue power to bargain with the company

For Buyers:-

The buying power of customers or buyers is higher. Globally, there are almost 314,000 installations also known as the Bloomberg or terminals Their customers pay a very handsome amount of more than $1500 a month, which increases the influence and bargaining power of company’s customers

SWOT analysis is imperative for effective utilization of a company’s intellectual and financial assets. This model gives an overall market analysis and highlights the current position of the company with its adopted strategic approach. It leads to the optimum level of production or services by using scarce resources. In other words, this model reveals a firm’s intrinsic and extrinsic market position in national and international companies