Corporate Finance Nike‚ INC: Cost of capital 1. What is the WACC and why is it important to estimate a firm’s cost of capital? Do you agree with Joanna Cohen’s WACC calculation? Why or why not? Definition of WACC (Weighted Average Cost of Capital): WACC is basically the average of the cost of finance (debt and equity). Since a company’s assets can be financed by debt or equity‚ WACC can show the averages of the costs involved in the sources of financing. These costs are then weighted
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and be successful ‚ any company need to have their own special vision and then putting it into actions‚ that is what Nike did with their famous slogan "Just do it" I would like to talk about Nike ’s company and mainly its famous marketing campaign "JUST DO IT". I will start with a brief overview of the company. Nike is a well known international company specialized in sportswear and sports equipments based in America headquartered near Beaverton‚ Oregon" Nike and Precision Cast parts are the only
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closely observing them since swans float on rivers for all to see; “Now the Swan it floated on the English river / Ah the Rose of High Romance it opened wide” (Cohen). The hero even says that “... the judges watched [them] from the other side” as they passed the summer together in their own little world‚ which is illustrated by the river (Cohen). Even though the couple’s peers are judging them‚ the two flirt and exchange conversation as if they are alone. The couple remains together regardless of the
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here) Analysis: Based on her calculations‚ Joanna Cohen estimated that Nike’s cost of capital was approximately 8.4%. Ms. Cohen used a single Weighted Average Cost of Capital to calculate the firm’s cost of capital‚ and we agree that only a single cost of capital needs to be used due to the similarities between more than 95% of their revenues. However we believe that the cost of capital calculation is inaccurate based on some of the information that Cohen gives while explaining the figures used in
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volume of trade‚ interaction and risk give what we now label as ’globalization ’ a peculiar force.( 1) With increased economic interconnection‚ some argue‚ multinational corporations. which rose the globalization of the ’brands ’ like Coca Cola‚ Nike and Sony. Anthony Giddens (1990: 64) has described globalization as ’the intensification of worldwide social relations which link distant localities in such a way that local happenings are shaped by events occurring many miles away and vice versa
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headquarters created an environment that encouraged the sale of Nike’s high-margin products to high-end customers. Regardless of the low cost of the World Shoes‚ they were still slapped with a high profit margin‚ resulting in overpriced products compared to local Chinese products. Second‚ because of the current distribution network and infrastructure that Nike had in place for its high-end footwear‚ the World Shoes‚ distributed through the same channels‚ didn’t reach the proper target market. The
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Jordan Hirsch AF 495 October 18‚ 2012 Nike Executive Summary Executive summary In this report I will focus on Nike’s Inc. Cost of Capital and its financial importance for the company and future investors. The management of Nike Inc. addresses issues both on top-line growth and operating performance. The company’s cost of capital is a critical element in such decisions and it is important to estimate precisely the weighted average cost of capital (WACC). In my analysis‚ I will examine
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Large Cap Fund‚ a mutual fund management firm‚ deciding whether to buy Nike’s Stock Nike’s net income has fallen from $800 million to $580 million since 1997. Also its profit and market share have declines significantly from 48% to 42% (Shoe products market share) from 1997 to 2000 To counter this down fall Nike has decided to develop more athletic shoe products in mid-priced segment and also to push their apparel line. It has also decided to cut down expenses Analyst reactions are mixed – Lehman
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1.Executive Summary This marketing plan mainly describes Nike future development strategies and goals. This report will include the situation analysis‚ market-product focus‚ the detailed marketing programme and the financial data and projections. In the coming year‚ Nike is going to launch a new product called Nike+ FuelBand‚ which will be marketed in Hong Kong in 2014. The Fuelband allows the wearer to track their physical activity‚ steps taken daily‚ and amount of calories burned. The
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seventh man should forgive himself for his failure to save K. in the wave. I am sure of this because even tho the seventh man will feel it was his fault‚ it wasn’t‚ it was K.’s fault for being out in the dangerous storm in the first place. “Many rescue workers have lost their own lives saving others.” as stated in the story‚ “The Cost Of Survival”. Survivors of tragic accidents claim they feel survivor’s guilt for not being able help others or maybe even witnessed them take their last breaths not because
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