Debt policy at UST inc. Case To: UST Board of Directors From: UST Financial analysis team Date: 18 January 2011 Subject: Future debt policy at UST and recapitalization option 1. Analysis of UST business current and future environment UST operates in the smokeless Tobacco industry‚ a market with 2 B$ of revenues‚ which grew at a CAGR of 3.7% over the past 17 years‚ but more recently experienced a decrease in growth rate‚ dropping to 2.9% in 1997 and 1.2% in 1998. In this market‚ UST
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lines that they compete in. The reason they started to expand was to protect itself from becoming an acquisition of a larger company. By expanding the company it has made itself less of a target and harder to become an acquisition by increasing cash flow and size. Smuckers has been very successful in expanding‚ purchasing top brands and increasing both revenues as well as profits by a very large margin‚ and also increasing its stock price. In my opinion the decision to expand was the right one‚ and
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Apple ’s financial performance continued to strengthen over the last several quarters. In the most recent earnings announcement‚ Apple reported significant growth in net revenues driven by the strong performance of its iPod product line. Net sales for the 2nd quarter grew to $4.36 billion‚ which is a 34% increase over 2nd quarter 2005 results. Net income increased by 41% to $410 million. (Apple Reports)The iPod product line continues to drive the financial performance of the company. In the 2nd quarter
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Palamon Capital Partners/TeamSystem S.P.A. 1. Valuation of TeamSystem S.P.A. using Free-Cash-Flow-to-Equity Model (FCFE) (1) Calculate Free cash flow to equity per year: FCFE = NI – (CAPX – DEPR) –NWC + Net Borrowing (2) Discount Rate / Equity Rate: Elson estimated discount rate to be 14%. (Source: Elson believed that a 14 percent discount rate would appropriately capture the risk of the cash flows.) (3) Present Value: Note: the company is expected to grow by 6% forever since
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Radio one analsys 1) Why does Radio One want to acquire the 12 urban stations from Clear Channel Communications in the top 50 markets along with nine stations in Charlotte‚ NC‚ Augusta‚ GA‚ and Indianapolis‚ IN? What benefits and risks? The Reasons for acquiring the 12 urban stations from Clear Channel could be the following: - Bigger African American Base: It would draw more African-American listeners than any other radio broadcaster and cover more African-American households than any
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THIS IS A LIST OF EXCEL PROGRAMS THAT YOU MIGHT FIND USEFUL. THEY ARE NOT COPY PROTECTED. FEEL FREE TO MODIFY THEM TO YOUR OWN NEEDS. Corporate Finance Spreadsheets 1. capbudg.xls: This program allows you to do a basic capital budgeting analysis for a project‚ and compute NPV‚ IRR and ROI. (For Macintosh version) 2. risk.xls: This program allows you to use past returns on a stock and a market index to analyse its price performance (Jensen’s Alpha)‚ its sensitivity to market movements
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To: Dr. Lynna Martinez Subject: Calaveras Vineyards Valuation As per your request‚ my associates and I have calculated a valuation for Calaveras Vineyards using the present value of cash flows. We used the valuation of future cash flows method in order to value to value the company. We have come to the conclusion‚ based on a number of future projections‚ that the best valuation of the vineyards is $4‚356‚000 in assets and $1‚104‚000 in equity. The process at determining this valuation was as
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Mercury Capital Analytics Corporate Finance White Paper Misinformation About Capital Management and Value Creation The quality of corporate financial management has deteriorated generally over the past few decades. Practitioners have become so enamored of engineering complex new investment instruments‚ and legal structures‚ as well as with accounting legerdemain‚ that attention has been diverted from the theoretical foundations which should help the practitioner accomplish his most critical function
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project free cash flows as opposed to the accounting profits earned by the project when analyzing whether to undertake the project? Free cash flow is one of the most important factors when looking at any new business or starting a new product. When calculating free cash flow‚ the business owner or management will able to have an idea about the cash that the company is generating enough cash to start new product or expand its business. Caledonia should focus on project free cash flows as opposed
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methods are yield methods. They are usually called Discounted Cash Flows (DCF) methods. Value of a company is derived from present value of future incomes connected with the ownership of a company. The core of these models is working with time value of future incomes investor gets in case of realization of an investment. There are several possibilities to work with future incomes in DCF models‚ like using cash flow‚ free cash flow or in some cases dividends. These are models with construction and
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