Laura Martin: Real Options and the Cable Industry Group 13 Adarsh N (60) Gaurav Chand (82) Hemant Kumar (83) Prateek Gupta (99) Rohan Gupta (104) Sahil Jindal (105) Individual Contribution: 16.67% for all group members Strategic Financial Management Prof. K . Sudershan Ques 1. What is the role of Laura Martin? Consider the multiples analysis developed in Exhibits 2‚ 5 & 6. What assumptions does this analysis rely upon? Role: Laura Martin is a sell-side equity analyst at
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arecomparable to the firm being valued. The market‚ on average‚ prices these firmscorrectly‚ but makes errors on the pricing of individual stocks. Exhibit 2 shows aselection of comparable firms‚ assuming that these firms have the same growth‚ riskand return as Cox Communications. There is also the assumption that financialfundamentals such as EBITDA are defined identically in all firms‚ with the sameaccounting methods and reporting periods. Exhibit 5 assumes a positive linearrelationship between ROIC and the
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financial data. 2. Select appropriate discount rate based on WACC 3. Discount each cashflow back to it present value 4. Obtain the terminal value through an application of terminal value multiple 5. You add these values together 6. Using this method‚ Martin calculates the price of Cox’s share to be $54.29 Multiple Valuation: 1. Identify comparable firms that have growth‚ cashflow and risks similar to those of target firm whose value is in question. 2. Obtain the individual multiple or ratio of the
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Laura Martin case study Question 1- Laura Martin says she gets "paid to talk" - to whom is she talking? Answer: Laura Martin is talking with investors. She would meet with many company representatives including the CEO‚ CFO‚ operating division chiefs and head of investor relations. She is in connections with these investors via telephone‚ fax‚ voice mail or email. It is approximately 900 individual per month. Question 2- Given this crazy web of relationships‚ what are Martin’s incentives
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Laura Martin: Real Options and the Cable Industry Introduction Laura Martin‚ an equity research analyst for cable stocks‚ believes that the best way to value cable stocks is through creative methods such as real options and not through more traditional or typical valuation methods such as EBITDA multiples‚ ROIC analysis and DCF analysis. In 1999 she presented at the Credit Suisse First Boston Broadband conference‚ where she wanted to portray the message that real options is a superior valuation
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Cox Regression Models Questions with Answers Worked Example An investigation is carried out into popularity of new cars being bought in the showroom of a Mercedes dealer. Data recorded for each car included colour‚ engine size and car type. A Cox proportional hazards model was fitted to the data and the results are given below: Write down the Cox hazard function according to this model. With regards to the model you have written down above state the following: • To which class of car does the
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Renee Cox‚ age 51‚ is a Jamaican-American artist‚ photographer‚ political activist‚ curator and mother. She was born in October 16‚ 1960 in Colgate‚ Jamaica. Her family was middle class. At three months old her family moved to Queens‚ New York. She attended catholic school and was the first girl to play on the boys’ basketball team. Her family later moved to Scarsdale‚ New York. Cox attended Syracuse University majoring in the study of Films. Her first aspiration was to become a filmmaker. Cox stated
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Advanced Corporate Finance and Modeling – FINA0065-1 Assignment #1 – Laura Martin: Real Options and the Cable Industry 1. Consider the multiples analysis developed in Exhibits 2‚5 & 6 Please describe the method of ‘Multiples’ using case numbers and answer to the following questions: 1.1. What assumptions does this analysis rely upon? 1.2. How is Martin’s regression analysis different from/similar to traditional multiples analysis? 1.3. Do you agree with her interpretation of the regression
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Problem Identification: There are quite a good number of problems in the case of CCC‚ among of which one can define‚ are the following: 1- Job security for the ethnic minorities who run the workshop for years‚ while being empowered in the age of Harold Cox‚ they felt threatened by the introduction of the new management system‚ that was reflected by the defensive attitude of Aziz and his lack of cooperation which also can be the reaction of being marginalized by Wilson while conducting the company review
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Cox Communications Applied Corporate Finance Contents Executive Summary Background Gannett and other acquisitions: possibilities and constraints of financing Feline PRIDES securities: benefits and costs for Cox Communications Valuation of Gannett’s acquisition Conclusions and recommendations Appendix Executive Summary The main purpose of this report is to evaluate an appropriate financing strategy for Cox Communications
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