"Midland Energy Resources Inc Cost Of Capital Excel Answers" Essays and Research Papers

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Midland Energy Resources Inc Cost Of Capital Excel Answers

Introduction: Midland Energy Resources, Inc. is a global energy company with its operations in three divisions – Oil and gas exploration, Refining and Marketing and Petrochemicals. The company has been there for 120 years and in 2007 had more than 80,000 employees. It has been a very profitable company with reported operating revenue of $248.5 billion and operating income of $42.2 billion in 2006. The primary goals of Midland’s financial strategy are to fund overseas growth, invest in value-creating...

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Midland Energy Resources, Inc.

Midland Energy [pic] Midland Energy Resources, Inc. Cost of Capital Table of Contents I. Executive Summary II. Introduction III. Cost of Capital IV. Risk & Tax Rate V. Capital Structures VI. WACC VII. Conclusion VIII. References I. Executive Summary Midland Energy Resources is a global energy company with operations in oil and gas exploration and production(E&P) providing a broad array of products and services to upstream oil and gas customers worldwide including refining and marketing...

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Midland Energy Resource Inc

Midland Energy Resources, Inc. Executive Summary Midland Energy Resources was fortunate enough to have a skilled financial manager in Mortensen. Her expertise had come to be respected as was evidenced by her promotion and the reliance on her calculations. However, her cost of equity numbers were used as a starting point and manipulated rather than used as presented. Examining the calculation of the firms weighted average cost of capital and betas as well as comparing with others in the same...

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Midland Energy Resources

1.) How does Midland determine that shares are undervalues? Midland Energy Resources determine that the shares are undervalued with a comparing from the intrinsic value of the shares and the actual stock price. The intrinsic value can be computed with the fundamental value of the enterprise minus the market value of debts divided per the number of shares outstanding. For calculate the fundamental value of the enterprise, Midland Energy Resources has to sum up all discounted future net cash flows...

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Midland Energy Resources, Inc. Case Study

Midland Energy Resources, Inc. 1.The Use of Cost of Capital First of all, cost of capital is an essential component in WACC. WACC is composed of cost of equity and cost of debt.The Mortensen’s estimates are used in various ways including asset appraisals for both capital budgeting and financial accounting, performance assessments, M&A proposals and stock repurchases at division ,business unit level and corporate level. 2. The Calculation for Wacc Midland’s wacc at the corporate level...

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Midland Energy Resources

Midland Energy Resources 1. For what purposes does Mortensen estimate Midland’s cost of capital? What would be the potential consequences of a too high estimate compared to the firm’s “true” cost of capital? What about a too low estimate? Estimates of the cost of capital were used in many analyses within Midland, including asset appraisals for both capital budgeting and financial accounting, performance assessments, M&A proposals, and stock repurchase decisions. Moreover, depending...

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Midland Energy Resources Case

 Midland Energy Resource Case Study Introduction Midland Energy Resources is a fairly successful global energy company which had been incorporated more than 120 years previously and in 2007 had more than 80,000 employees. It has three main operations, oil and gas exploration and production (E&P), refining and marketing (R&M), and petrochemicals. E&P is the most profitable segment of Midland and its net margin over the previous five years was among the highest in the industry. Its largest...

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Case Report for Midland Energy Resources, Inc: Cost of Capital

estimate Midland's cost of capital? What would be the potential consequences of a too high estimate compared to the firm's “true” cost of capital? What about a too low estimate? The purpose is that the cost capital will be used for capital budgeting, financial accounting, performance assessment, stock repurchases estimations. Also the cost of capital is a necessary basis for the expected growth and forecasted demand. The too high estimated cost of capital means that Midland may miss out on investment...

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Midland Energy

prepare a 2-3 pages of case memo addressing the following issues. Please include the Excel sheets to support your answers. 1. How are Mortensen’s estimates of Midland’s cost of capital used? How, if at all, should these anticipated uses affect the calculations? Janet Mortensen, Senior Vice President of project finance for Midland Energy Resources has calculated yearly annual cost of capital investments for Midland and each of its three divisions. The three divisions consist of oil and gas Exploration...

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Midland Energy Resources Case Analysis

Midland Energy Resources Case Analysis Midland Energy Capital Planning Model • Fund significant overseas growth • As domestic natural resources dwindle, overseas investments are the main drivers of growth for Midland. These investments are analyzed and evaluated is US dollars (foreign cash flows are converted to US dollars) and have a US dollar discount rate applied to them. In 2006, 77.7% of Midland’s total earnings from equity affiliates came from non-US investments. • Invest in value creating...

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