outstanding EPS show a steady increase over the past five years indicating that Stanley is achieving hisgoal of maximizing profits. c. Operating Cash Flow (OCF) for 2012OCF = {Earnings Before Interest and Taxes×(1– Tax rate)} + Depreciation OCF = {EBIT × (1– T)} + Depreciation = {$89 000 × (1 – 0.20)} + $11 000 = $82 200 Free Cash Flow (FCF) for 2012 FCF = OCF1– Net Fixed Assets Investments – Net Current Assets Investment FCF = OCF – NFAI – NCAI NFAI = Change in net fixed assets + Depreciation=
Premium Stock market Stock Free cash flow
Course: project economics and evaluation Course code: C11PV Coursework title: Project Appraisal Student Number: H00152083 Lecturer: Dr. Esinath Ndiweni 1. Introduction The work is centred on the importance of project appraisal therefore emphasising on the financial and non-financial techniques of appraisal. The object and‚ therefore‚ the importance of a project appraisal is making an analysis to see whether the project is viable. It is vital to know whether a project is technically
Premium Net present value Discounted cash flow
Introduction to the Finance Company Project Your team is required to analyze the future business and economic prospects of a major‚ publicly traded corporation using financial concepts and techniques as well as the concepts and techniques from other business areas. Make sure any statements you make in your analysis are consistent with the knowledge base of finance. Also please include your calculations (including spreadsheets)‚ data sources (be specific‚ including date and page number(s))‚ and
Premium Corporate finance Weighted average cost of capital Finance
exchange ratio of 0.65. The merger of Amoco and BP had strategic significance. As Amoco‚ we are satisfied with this price‚ bringing Amoco shareholders $8.6 billion value through negotiation. 2. Stand-alone valuation of Amoco When valuing the stand-alone value of Amoco‚ both WACC method (See Appendix 1) and multiples valuation (See Appendix 3) and are used to estimate the stock price. Eventually‚ two methods give us pretty much the same results. From the balance sheet of Amoco‚ we can find out
Premium Stock market Fundamental analysis Generally Accepted Accounting Principles
projects. Projects are managed concurrently under a single umbrella and may be either related or independent of one another. 1. Keflavik Paper presents a good example of the dangers of excessive reliance on one screening technique (discounted cash flows). How might excessive or exclusive reliance on other screening methods discussed in this chapter lead to similar problems? Some measures that allow us to screen projects may lead to the wrong conclusions; for example‚ suppose that we selected
Premium Project management Discounted cash flow
cash flows 4 NET PRESENT VALUE Cash revenue year 1 Note: cash in the future is worth less than cash now‚ so we discount it + + + + Cash revenue year 2 Cash revenue year 3 Cash revenue year 4 Cash revenue year 5 etc... Linking Market-Based Assets to Shareholder Value Usage‚ impact on repeat usage perceptions‚ image‚ satisfaction‚ awareness‚ knowledge Market-Based Assets Market Performance Shareholder Value Customer Relationships: Faster Market Penetration Accelerate Cash Flows Brands
Premium Net present value Discounted cash flow Generally Accepted Accounting Principles
has provided for us. We used a discount rate of 3.2%. The percentage used was based on the growth rate of GDP and what numerous other sites suggest the industrial manufacturing industry is growing at. We are also under the assumption that FVC’s cash flow projections are correct. However‚ we are very skeptical of FVC’s projected growth. From 2003 to 2007 their sales increased by a total of 36% over the period. Their projections from 2008 to
Premium Discounted cash flow Cash Revenue
Sears? For Wal-Mart? Week 2: Valuing Rajat Bhatia’s Business Plan 1. Estimate (i) the current market value of the firm’s debt‚ (ii) the current market value of the firm using the free cash flow to equity‚ and (iii) the current market value of the firm using the free cash flow to the firm. Week 3: Deutsche Brauerei 1. What accounts for Deutsche Brauerei’s rapid growth in recent years? Specifically‚ what policy choices account for this success? 2. What is Deutsche
Premium Net present value Rate of return Cash flow
【SID:310316707 Name: Min Ouyang】 Rocky Mountain Advanced Genome Inc. Case Analysis Report Question 1: Forecast Horizon and Free Cash Flow Projections 1 Forecast Horizon In order to derive the forecast horizon‚ an approach of product-life cycle is used to evaluate the reasonable forecast horizon. Proper forecast horizon need to extend into the future in which the firm is under a steady-state‚ slow-growth or no-growth condition. By that time‚ the firm step into the maturity and decline period
Premium Revenue Discounted cash flow Net present value
cash flows are the cash flows that should be used in calculating the NPV of a project. The cash flows are changes in cash flows that occur as a direct consequence of accepting a project‚ not the cash flows that the company is already receiving. No we do not include interest expense in the capital budging process‚ because any increase in interest expense related to the firms decision regarded on how to finance the project is a separate decision. Capital budging using incremental cash flow is a decision
Premium Net present value Cash flow Internal rate of return