Free cash flow Essays & Research Papers

Best Free cash flow Essays

  • Free Cash Flow - 428 Words
    Pinkerton case - General Create NPV “Be Big” • Check out case instructions on bspace & begin working with your group Historical case – CPP’s bid to acquire Pinkerton security guard firm in the late 1980s Provide executive summary & detailed analysis of value of acquisition Email your group’s bid to GSI before 6 p.m. evening before discussion Be prepared to discuss the case in class (your answers, your analysis, etc.) 1 Valuation - Use NPV approach How to make investment...
    428 Words | 4 Pages
  • Finance: Free Cash Flow
    inance COOPERATE FINANCE | Miss Afifa | | Assignment# 4 | | UMAIR ASIF11 March 2013 | You submitted this Assignment on Sun 10 Mar 2013 7:21 PM PDT. You got a score of 85.00 out of 100.00. You can attempt again, if you'd like. Top of Form Please read all questions and instructions carefully. Note that you only need to enter answers in terms of numbers and without any symbols (including $, %, commas, etc.). Enter all dollars without decimals and all interest rates in percentage...
    1,850 Words | 7 Pages
  • Free Cash Flow - 335 Words
    Instructions for Blockbuster Effective 2005, Blockbuster began a new policy of no late fees. In late 2005, Blockbuster was experiencing financial distress and needed emergency financing to stay afloat. The stock price dropped from $12 to $4, and the debt traded as junk. Question 1: Analyze the soundness of the decision, given the contribution that late fees made to prior years’ results. Does an analysis of the company’s cash flows support or refute the company’s decision? What you...
    335 Words | 2 Pages
  • Free Cash Flow - 615 Words
    What Is Free Cash Flow and How Is It Used? Free Cash Flow is defined as “a measure of financial performance calculated as operating cash flow minus capital expenditures” (Free Cash Flow). So, you may ask what does it represent, how is it calculated and why is it important in business? Free Cash Flow represents the cash that a company is able to generate after setting aside the money that the company will require to maintain or expand its asset base. It is basically a measure of the company’s...
    615 Words | 2 Pages
  • All Free cash flow Essays

  • Free Cash Flow - 1468 Words
    Free cash flow In corporate finance, free cash flow (FCF) is cash flow available for distribution among all the securities holders of an organization. They include equity holders, debt holders, preferred stock holders, convertible security holders, and so on. G. Bennett Stewart - the "economic model of value holds that share prices are determined by just two things: the cash to be generated over the lifetime of a business and the risk of the cash receipts”. GSB (1990), “The Quest for...
    1,468 Words | 6 Pages
  • Free Cash Flow and Pinkerton
    Pinkerton (A) Assignment The assignment is twofold. First, to advise Tom Wathen as to whether he should buy Pinkerton for the asking price of $100 million. Second, regardless of your answer to #1, assuming that Wathen does buy Pinkerton, should he finance the purchase with Financing Alternative #1 (debt and equity financing from an investment firm) or Alternative #2 (all debt financing from a bank). The financing alternatives are discussed on page 4 of the case. You should do the...
    514 Words | 2 Pages
  • Finance and Free Cash Flows
    FIN-516 – WEEK 6 - HOMEWORK - CH. 21 No. 1 – Acquisition Analysis Brau Auto, a national autoparts chain, is considering purchasing a smaller chain, South Georgia Parts (SGP). Brau's analysts project that the merger will result in the following incremental free cash flows, tax shields, and horizon values: Years 1 2 3 4 Free cash flow $1 $3 $3 $7 Unlevered horizon value 75 Tax shield 1 1 2 3 Horizon value of tax shield 32 Assume that all cash flows occur...
    440 Words | 2 Pages
  • Free Cash Flow and Butler
    Introduction Butler Capital Partners (Butler) is an investment fund founded in 1990. Butler closed its first private equity fund, European Strategic Fund, in 1991. This first fund was mainly focusing on small family owned enterprises and on divisions of larger companies. Mainly of his first success he closed in 1998 his second fund, Private Equity II, and Butler became one of the largest independent funds in France. With his second fund he would focus on investments in France on a larger...
    4,148 Words | 12 Pages
  • Free Cash Flow and Total Value
    1 – Methodological Approach In this case, American CC – the intended acquirer of AirThread Connections- will use leveraged buyout (LBO) model, which means the company will finance the acquisition through bank loan or some other borrowing methods. Hence, the debt-to-equity ratio will change in time. Since we will need to estimate the discount rate any time the capital structure changes, neither WACC nor APV would be reliable alone. Therefore, Ms. Zhang should use the combination of WACC and...
    1,228 Words | 6 Pages
  • Free Cash Flow by C. Chang
    Free Cash Flows Revised by C. Chang. Copyright 1996 by The McGraw-Hill Companies, Inc OUTLINE n  n  n  n  n  n  n  What is FCF? FCFF? FCFE? How Do You Calculate FCFF? FCFF Calculation– the CFO Method FCFF Calculation– the EBIT Method Equivalence: FCFF(CFO) vs FCFF(EBIT) Free Cash Flow to Equity (FCFE) Free Cash Flow Example What is FCF? FCFF? FCFE? n  Free Cash Flows to Firm (FCFF) n  The cash produced by the business activities of a firm available for...
    656 Words | 0 Page
  • Free Cash Flow and Corporate Valuation Model
    Assignment Chapter 15 True/False Indicate whether the statement is true or false. _F___ 1. The corporate valuation model cannot be used unless a company doesn't pay dividends. _T___ 2. Free cash flows should be discounted at the firm's weighted average cost of capital to find the value of its operations. _F___ 3. Value-based management focuses on sales growth, profitability, capital requirements, the weighted average cost of capital, and the dividend growth rate. _F___ 4....
    1,499 Words | 7 Pages
  • Net Present Value and Free Cash Flow
    1. Given the proposed financing plan, describe your approach (qualitatively) to value AirThread. Should Ms. Zhang use WACC, APV or some combination thereof? Explain. (2 points) * From the statement of AirThread case, we know that American Cable Communication want to raise capital by Leveraged Buyout (LBO) approach. This means ACC will finance money though equity and debt to buy AirThread and pay the debt by the cash flows or assets of AirThread. * In another word, it’s a highly levered...
    1,090 Words | 4 Pages
  • Cash Flow and Company - 3601 Words
    Wendy’s Steve McElroy Ohio Dominican University This document contains financial analysis of the Wendy’s corporation. It highlights many of the company’s financial ratios and other calculations used to measure the success of a company. The Wendy’s Company is the #2 hamburger chain in the United States following #1 McDonalds (Hoovers). The Wendy’s Company (NASDAQ:WEN) is the world’s third largest quick-service hamburger company (Wendy’ The company consists of almost...
    3,601 Words | 14 Pages
  • Cash Flow and Growth Rate
    Week 8 Case Study – JetBlue Man Hon Chan 22002960 Introduction An initial public offering (IPO) refers to the initial stage of shares offering to the public market for subscriptions by a company to raise capital for the purpose of expansion. It is considered as a big issue for companies as an IPO does not necessary guarantee the success of a company as it is merely a tool of raising capital while its costs of issuance and consecutive monitoring costs (due to diluted shareholdings of...
    1,802 Words | 5 Pages
  • Discounted Cash Flow - 848 Words
    REEBY SPORTS Principles of Corporate Finance 7th Edition Richard A. Brealey and Stewart C. Myers George Reeby proposes to sell 90,000 shares, or about 22%, of his company. How much are those shares worth? We have to value the company using George's forecasts. The forecasts presented in Tables 4.10 and 4.11 do not show free cash flow and financing requirements. These are calculated in Table 1. Note that free cash flow for 2005 is -$2.3 million. But dividends are $2.0, so...
    848 Words | 5 Pages
  • Accounting: Depreciation and Cash Flow
    (10-8) NPVs, IRRs, and MIRRs for Independent Projects Edelman Engineering is considering including two pieces of equipment, a truck and an overhead pulley system, in this year’s capital budget. The projects are independent. The cash outlay for the truck is $17,100 and that for the pulley system is $22,430. The firm’s cost of capital is 14%. After-tax cash flows, including depreciation, are as follows: Year Truck Pulley 1 $5,100 $7,500 2 $5,100 $7,500 3 $5,100 $7,500 4 $5,100 $7,500 5...
    1,376 Words | 6 Pages
  • Understanding Cash Flows - 992 Words
    Understanding Cash Flows and Capital-Budgeting DecisionsIndiana Wesleyan University FIN-310-01A Dr. Sam OjoOctober 19, 2014 Understanding Cash Flows and Capital-Budgeting Decisions When evaluating cash flows for determining whether or not to pursue constructing a building to manufacture cupcakes there are several things to consider. The most important would be looking at a Grammy’s incremental after tax cash flow. Then one needs to determine the projects initial outlay, the differential...
    992 Words | 4 Pages
  • Cash Flow Analysis - 577 Words
    Accounting analysis of Financial StatementsAnalysis of Statement of Cash Flow Master of Business Administration University of Kelaniya 1 CASH FLOW RATIOS • Cash flow ratios can be categorized as,  Performance ratios  Coverage ratios 2 Performance Ratios 1. 2. 3. 4. Operating Cash Flow to Sales Cash Return to Assets Cash Return on Equity Ratio Cash flow per share 1. Operating Cash Flow to Sales • Expressed as a percentage, compares a company's operating cash flow to its net sales or...
    577 Words | 4 Pages
  • Cash Flow (Incremental) - 363 Words
    Fin370 Week 4 Learning Team Assignment Caledonia should focus on project free cash flows as opposed to the accounting profits earned by the project when analyzing whether to undertake the project because cash flows formulas focus on the project itself. Free cash flow formula determines whether an investment adds value to the firm, which important to Caledonia’s management. Since one of a firm’s primary goal is to gain profits for its stakeholders, using free cash flow formula would offer...
    363 Words | 1 Page
  • Cash Flow and Working Capital Simulation
    FIN 571 Week 6 Working Capital Simulation Managing Growth Assignment Click this link to get the tutorial: Harvard Business Publishing: Working Capital Simulation: Managing Growth Assignment Ch. 1 - 21 ofFundamentals of Corporate Finance WileyPLUS Assignments All additional resources from each week Review the following scenario: Acting as the CEO of a small company called...
    326 Words | 2 Pages
  • Discounted Cash Flow (Dcf) Analysis
    DCF Modeling Copyright 2008 © by Wall Street Prep, Inc. ***************************** SAMPLE PAGES FROM TUTORIAL GUIDE ***************************** Table of contents SECTION 1: OVERVIEW DCF in theory and in practice Unlevered vs. levered DCF SECTION 2: MODELING THE DCF Modeling unlevered free cash flows Discounting to reflect stub year and mid-year adjustment Terminal value using growth in perpetuity approach Terminal value using exit multiple approach Calculating net debt Shares...
    1,400 Words | 7 Pages
  • Arcadian: Cash Flow and Terminal Value
    1. Prepare to explain the implications of case Exhibit 1 (Paige Simon’s first task). Based on that exhibit, is terminal value (TV) a material component of firm values? From the exhibit, we can find the PV of five years’ dividends is small part of the market price of the stock. In my opinion, we buy a stock then get dividend periodically, which like buy a bond. The coupon payment is dividend and the face value is terminal value. The bond value is determined by the terminal value mostly. So the...
    1,092 Words | 4 Pages
  • Discounted Cash Flow Analysis - Empirical Study
    An empirical study of the discounted cash flow model Martin Edsinger1, Christian Stenberg2 June 2008 Master’s thesis in Accounting and Financial Management Stockholm School of Economics Abstract The purpose of this thesis is to compare the practical use of the DCF model with the theoretical recommendations. The empirical study is based on eight different DCF models performed by American, European and Nordic investment banks on the Swedish retail company Hennes & Mauritz (H&M). These...
    12,797 Words | 39 Pages
  • Capital Cash Flows: a Simple Approach to Valuing Risky Cash Flows Richard S. Ruback
    Capital Cash Flows: A Simple Approach to Valuing Risky Cash Flows Richard S. Ruback* This paper presents the Capital Cash Flow (CCF) method for valuing risky cash flows. I show that the CCF method is equivalent to discounting Free Cash Flows (FCF) by the weighted average cost of capital. Because the interest tax shields are included in the cash flows, the CCF approach is easier to apply whenever debt is forecasted in levels instead of as a percent of total enterprise value. The CCF method...
    9,368 Words | 31 Pages
  • cash holding - 974 Words
     A STUDY ON: - STOCK MARKET AND MARKET PERFORMANCES OF HIGH AND LOW CASH HOLDING FIRMS. Prepared By Pranshu Singh 12010221059 Submitted to: - Prof. Naveen Kumar INTRODUCTION Stock market performance in high and low cash holding firm depends on the determinants of corporate cash holdings that have occupied a central place in corporate finance literature. Cash holding, according to Gill and Shah (2012) is...
    974 Words | 4 Pages
  • Cash Budget for Congo Limited
    CASH BUDGET FOR CONGO LIMITED | | FEBRUARY $’000 | MARCH $’000 | APRIL $’000 | Total $’000 | Cash On Hand | 1,800 | 3,568 | 2,805 | 8,173 | | | | | | Cash Receipts | | | | | Cash Sales | 1,850 | 1,620 | 1,400 | 4,870 | Collections from CR Accounts | 13,110 | 11,875 | 10,545 | 35,530 | Total Cash Receipts | 14,960 | 13,495 | 11,945 | 40,400 | Total Cash Available | 16,760 | 17,063 | 14,750 | 48,573 | | | | | | Cash Paid Out | | | | | Purchases Resale |...
    1,151 Words | 4 Pages
  • Valuation Summary - 1372 Words
    Valuation methods: 1. Introduction: -Enterprise value = Equity (number of shares * shares price, or, if not traded, Market value of the Equity) + Debt ( without accounst payable) 2. Main Valuation Methods: A) Fundamental Method or Discounted Cash flow method: Enterprise value = Present value=CF11+r+CF21+r^2+…+CFn 1+r^n.+ Terminal Value In the cash flow calculation the working capital = Acc receivable + inventory – Acc payable (you don’t include cash because even if...
    1,372 Words | 5 Pages
  • Mergers - 756 Words
    Mergers are referring to the consolidation of two companies. After the merger the two companies became one but acqusition is different than merger because in the acqusition the firm which acquiries the other firm stays solid and the other firm becomes a part of the acquirer. In the mergers the concept which is often used is discounted cash flow method(DCF). This method is for valuation of the companies. There are both some advantages and disadvantages for Discounted Cash Flows. The advantages...
    756 Words | 5 Pages
  • UFC Valuation - 2252 Words
    Techniques in Finance & Valuation 1 What is Valuation? Valuation: Methods of quantifying how much money something should be exchanged for today, considering future benefits. We will teach 4 valuation methods Trading Comparables Transaction Comparables Sum-of-the-Parts Valuation Discounted Cash Flow Analysis (DCF) $ 2 Why is Valuation important? Acquisitions: How much should we pay for the company? Divestitures: How much should we sell our company for? Sell-side Research: Should our...
    2,252 Words | 38 Pages
  • Pancake House Financial Analysis
    Contents Introduction to the Company 2 SWOT analysis 3 Strengths 3 Weakness 3 Opportunities 4 Threats 4 Industry Analysis 5 Overview 5 Industry Structure (Based On Product Offerings) 5 Five Forces Analysis 5 Competitive Rivalry (High) 5 Bargaining Power of Suppliers (Low) 6 Bargaining Power over Buyers (Medium) 6 Threat of Substitutes (High) 6 Entry of New Players (High) 6 Ratio Analysis 7 Profitability Ratios 7 Growth Ratios 7...
    3,430 Words | 16 Pages
  • Sime Darby - 1378 Words
    Page 1 of 6 Fundamental Analysis for SIME DARBY BHD Company Name: Stock Code (Bursa): Bloomberg: Industry: Sub-Sector: Company Description: Date of Analysis: Financial Year: SIME DARBY BHD Board: Main Board SIME FBMKLCI: TRUE SIME:MK Reuters: SIME.KL TRADING SERVICES OIL PALM/RUBBER AND OTH CROP PRODUCTION PLANTATION; PROP; MOTORS; INDUSTRIAL; ENERGY & UTILITIES. 19-Sep-12 2011 30/6/2011 Price: 9.79 Stock Grade: Emerging Investment Grade Profitability Profitability 10 ROI 8 ROI Liquidity 6...
    1,378 Words | 8 Pages
  • Mercury Athletic Footwear - 623 Words
     Mercury Athletic Footwear: Valuing the Opportunity Group 1 Bushra Javed Butt M. Sharjeel Shahid Mahnoor Malik Uzair Nasir MBA II – Section A Submitted To: Sir Nawazish Mirza Introduction West Coast Fashions, Inc. (WCF), a large designer and marketer of men’s and women’s apparel decided to dispose of one of their divisions; Mercury Athletic. John Liedtke, head of the business development for Active Gear, Inc. (AGI), saw a possible opportunity for his company in acquiring Mercury. The...
    623 Words | 3 Pages
  • Blackberry - 2188 Words
    Executive Summary Blackberry designs, manufactures and markets wireless solutions for the worldwide mobile communications market. The company supports multiple wireless network standards by developing integrated hardware, software and services. RIM provides platforms and solutions for seamless accessing information, including e-mail, voice, instant messaging, short message service (SMS), internet and intranet-based applications and browsing. Founded in 1984 by Mr. Michael Lazaridis and Mr....
    2,188 Words | 7 Pages
  • Valuation of Bmw - 30821 Words
    Bachelor Thesis Department of Business Studies Århus, the 3rd of May 2010 Valuation of BMW - Financial & Strategic Analysis Authors Rasmus Ramshøj Pløen Exam no. 282821 BSc (B/IM) Mikkel Kronborg Olesen Exam no. 283755 BSc (B) Academic Advisor Nicolai Borcher Hansen ASB Aarhus School of Business TABLE OF CONTENTS 1 PREFACE...
    30,821 Words | 93 Pages
  • Discussion - 559 Words
    The first chapter discusses the basics of financial management. How critical is financial decision to social welfare? Reflect on the oil spill disaster in the gulf. Is it all about making money? Financial decisions are extremely critical to social welfare. Many individuals have the state of mind that emphasizes the belief of how social welfare can be pursued through exercising one’s choice and making provisions to obtain the means to be financially stable. The world is increasingly...
    559 Words | 2 Pages
  • Bloomberg Assessment: Sample Test Questions
    BLOOMBERG ASSESSMENT (BAT) SAMPLE TEST QUESTIONS I. Economics You have just been transferred to Sydney and cover Australia and New Zealand on the sovereign research desk. Australia and New Zealand operate under a free trade agreement. No barriers to trade exist, and both currencies float. In this environment, an increase in expected inflation in New Zealand would most likely cause what effect? Choose One Answer o o o  An increase in exports from New Zealand to Australia An increase in...
    2,093 Words | 8 Pages
  • CaseStudyBBC - 843 Words
    Guidelines for written case analysis Working in teams of up to four students your task will be to recommend an IPO price for the Boston Beer Company, Inc. Your grade will be based on your answers to the assigned case questions. You do not need to list the question and then your answer (as you might do for a problem set). The questions are there to serve as a guide to arrive at the solution of the case. As such, answers to these questions should be integrated as part of the report and you...
    843 Words | 4 Pages
  • Cemex Case - 1211 Words
    Cemex Key points summary | |Cemex was originally founded in 1906 as Cementos Hidalgo and became Cemex (Cementos Mexicanos) after a merger | |Case Summary |with Cementos Portland Monterrey in 1931. Throughout the 1960’s, 70’s, and 80’s, Cemex expanded throughout | | |Mexico to gain a 65% share of the domestic market by the end of the 1980’s. Under the leadership of CEO Lorenzo | |...
    1,211 Words | 5 Pages
  • National Express Analysis - 2619 Words
    Full Year Results Year ended 31 December 2012 28 February 2013 Cautionary statement This Review is intended to focus on matters which are relevant to the interests of shareholders in the Company. The purpose of the Review is to assist shareholders in assessing the strategies adopted and performance delivered by the Company and the potential for those strategies to succeed. It should not be relied upon by any other party or for any other purpose. Forward looking statements are made in good...
    2,619 Words | 24 Pages
  • Dividend Irrelevance Theory - 5931 Words
    Dividend irrelevance theoryRelevance or irrelevance of retention for dividend policy irrelevance Carlo Alberto Magni Department of Economics, University of Modena and Reggio Emilia viale Berengario 51, 41100 Modena, Italy Email: Abstract. In an interesting recent paper, DeAngelo and DeAngelo (2006) highlight that Miller and Modigliani’s (1961) proof of dividend irrelevance is based on the assumption that the amount of dividends distributed to shareholders is equal or greater...
    5,931 Words | 22 Pages
  • Dwe Fdbdfgb Dfbdfhgsfbhdsf - 1876 Words
    1. Do you think Mercury is an appropriate target for AGI? Why or why not? Mercury is an appropriate target for AGI. AGI is looking to increase its revenue and profit by utilizing synergies. The initial aim of AGI for acquiring Mercury Athletics is to increase leverage with contract manufacturers and to boost the cooperation with the retailers and distributors. AGI was one of the most profitable and successful companies in the market segment, but the firm’s size remained rather small in...
    1,876 Words | 15 Pages
  • Blue Line Management - 11928 Words
    V O LU M E 2 6 | N U M B E R 1 | WIN TER 2 0 1 4 Journal of APPLIED CORPORATE FINANCE In This Issue: Value-based Management, CEO Pay, and Private Equity Managing for Value 2.0 8 Kevin Kaiser and S. David Young, INSEAD The Growing Executive Compensation Advantage of Private Versus Public Companies 20 Three Versions of Perfect Pay for Performance (Or The Rebirth of Partnership Concepts in Executive Pay) 29 Stephen F. O’Byrne, Shareholder Value Advisors Inc. A Look Back at the...
    11,928 Words | 48 Pages
  • Cfp Test Notes - 357 Words
    CFP FINAL EXAM NOTES: Ch18: Capital budgeting & Valuation with leverage; *Overview of concepts: * Interest payments are tax deductible as an expense for the corp, debt financing creates valuable ITS for the firm. * Can include value of ITS in several ways: 1. WACC METHOD; discount unlevered free cash flows using the weighted average cost of capital (WACC). Because we calculate the WACC using the effective after-tax interest rate as the cost of debt, therefore this...
    357 Words | 2 Pages
  • Ocean carrier - 427 Words
    Assignment 1: Ocean Carriers Refer to the HBS case “Ocean Carriers” and answer the questions below. Each student must turn in a hardcopy of her/his solution and answers in class at the start of the week-4 lecture. She/he must also up-load a softcopy of her/his solution spreadsheet on LMES by then, too. Note: You should complete the related textbook chapters (RWJJ Chapters 7 & 8) before attempting this case. In particular, you need to study the Baldwin Case first (Chapter 8.2 + material on...
    427 Words | 2 Pages
  • Week 7 - 406 Words
    A. 1. Net Operating Profit after Taxes (Operating Income x (1-Tax Rate) NOPAT for 2011 = 108.6 (1-.40) =$65.16 2. Net Operating Working Capital for 2011 is calculated through Taking your Current Assets less – Non-Interest Bearing Current Liabilities NOWC for 2011 = ($5.6 + $56.2 + $112.4) – ($11.2 + $28.1) = $134.9 million. 3. Net Capital for 2011 is calculated the sum of NOWC (already shown as) 134.9 million + Net Fixed Assets (2011 Projected PP&E) of 397.5 = Net Capital for 2011 of =...
    406 Words | 1 Page
  • Mercury Athletic - 800 Words
    RE: Mercury Athletic valuation and acquisition recommendations We believe that Mercury is an appropriate target for AGI since an acquisition can be an excellent growth opportunity. First, through the acquisition AGI can take the advantages of some existing synergies. Acquiring Mercury would expand AGI’s business size and consequently produce the “one plus one is greater than two” effect. This acquisition would double AGI’s revenues, increase its leverage with contract manufacturers, and also...
    800 Words | 7 Pages
  • Bloomberg Assessment (Bat) - 1662 Words
    Bloomberg Assessment (BAT) SAMPLE TEST QUESTIONS I. Economics You have just been transferred to Sydney and cover Australia and New Zealand on the sovereign research desk. Australia and New Zealand operate under a free trade agreement. No barriers to trade exist, and both currencies float. In this environment, an increase in expected inflation in New Zealand would most likely cause what effect? Choose One Answer o o o  An increase in exports from New Zealand to Australia An increase...
    1,662 Words | 7 Pages
  • Mercury Athletic Footwear Case
    Mercury athletic footwear Group 7 Contents Executive Summary & Overview of Problems 3 Analysis on Mercury acquisition 4 1. Reasons why Mercury is an appropriate target for AGI 4 2. Estimation the value of Mercury based on discounted cash flows and Liedtke’s base case projections. 4 a. Estimation of the weighted average cost of capital 5 b. Estimation of the free cash flows from 2007 to 2011 5 c. Estimation for long-term growth rate and estimate the terminal value 5 d. Estimation value...
    1,280 Words | 7 Pages
  • Mva, Eva, Fcf - 2347 Words
    1.0 BACKGROUND In assignment 2, I was assigned to find the relationship between Free Cash Flow (from now on refer as FCF), Economic Value Added (from now on refer as EVA) and Market Value Added (from now on refer as MVA), specifically whether a company with high FCF also have high EVA and MVA. Explanation using empirical evidence is also needed to support my reasoning and arguments. Therefore, in order to complete this assignment, I have used a few types of references which are financial...
    2,347 Words | 8 Pages
  • Jet Blue IPO Valuation
     To: JetBlue Management Team From: Subj: JetBlue IPO Price Recommendation Date: April 11, 2002 Introduction JetBlue is a company that was founded on not accepting the status quo with regard to how airline travel is “supposed to be”. Recent history shows that low-fare airlines are gaining momentum, and JetBlue’s business model sets us apart- our fleet is newer, more reliable and efficient. We offer the lowest cost per available seat mile than any other U.S. airline, and we...
    1,218 Words | 12 Pages
  • Framedia - 1572 Words
     Q1. If we want to do the stand-alone-valuation for Framedia at the end of 2005, we should calculate the free cash flow to firm after 2005 and the residual value of Framedia and then discount all the cash flows to the end of 2005. Because it’s stand-alone-valuation we should do, we need to value the whole firm and then compare the stand-alone-value with the synergistic value after the merger. So it’s the firm value we should compare with. We can get the effective tax rate by dividing the...
    1,572 Words | 7 Pages
  • Analysis on Olin Corporation - 3754 Words
    The Analysis and Valuation of Olin Corporation (OLN) By Elizabeth Demmon Submitted on December 13, 2011 SUMMARY 1 BACKGROUND 1 Industry and company 1 Chlor Alkali 1 Winchester 2 Management and Ownership 3 Recent developments 3 FINANCIAL ANALYSIS 3 Discussion of financial statements 3 Discussion of financial ratios 4 OUTLOOK AND FORECAST 4 Economy 4 Industry 5 Company 5 Investment thesis 5 Important value drivers 5 Risks, caveats, and exposures 6...
    3,754 Words | 11 Pages
  • IFM11 TB Ch26 - 3672 Words
    CHAPTER 26 MERGERS, LBOs, DIVESTITURES, AND HOLDING COMPANIES Please see the preface for information on the AACSB letter indicators (F, M, etc.) on the subject lines. True/False Easy: (26.1) Synergistic merger FU Answer: a EASY 1. In a merger with true synergies, the post-merger value exceeds the sum of the separate companies' pre-merger values. a. True b. False (26.1) Sources of synergy FU Answer: a EASY 2. Synergistic benefits can arise from a number of...
    3,672 Words | 17 Pages
  • Group Case 3: Mci Communications Corp., 1983
    Group Case 3: MCI Communications Corp., 1983 Executive Summary Assumptions The following are the assumptions we made through the whole analysis. The predicted revenues from 1983 to 1990 were assumed to follow the pattern in Exhibit 9A, despite the uncertainty of the higher access charge and competition increase. The marginal tax rate is 30% during that period. The firm must keep minimal cash balance of $100 million to support its operating activities....
    301 Words | 2 Pages
  • Caledonia Products - 632 Words
    Caledonia Products Integrative Problem 1. Why should Caledonia focus on project free cash flows as opposed to the accounting profits earned by the project when analyzing whether to undertake the project? Free cash flows are being focused on because it the amount that Caledonia will receive and they will be able to reinvest that amount. Caledonia should analyze the free cash flow so that they are able to see the real amount of value or what the cost may be. The marginal value from the project...
    632 Words | 3 Pages
  • Working capital management is the toughest task for the business growth
    Working capital management is the toughest task for the business growth. It is very important that, we go for funding requisite amount in form working capital as per the needs of the business in appropriate time. Hence it is pretty encouraging that, every entrepreneur looks for an appropriate working capital (Investorword’s.Com. 2013) for the business. Phase – 1 Sales – The sales are increasing by $4 million each year and it may be accepted as SNC started it’s business in the year 2006 and...
    1,332 Words | 4 Pages
  • Csx - Contrail Cast Study Solution
    1. What is CSX’s motive for buying Conrail? • Synergy effect with lower cost The merged company could consolidate overlapping operations and reduce cost. CSX estimated that cost reduction would yield an additional $370 million in annual operating income by the year 2000, net of merger costs. • Expansion of market share by extending railroad network Railroad industry is a mature market. The only option to grow is through acquisitions. In 1995, Conrail owned 29.4% of the Eastern...
    1,151 Words | 4 Pages
  • Case Study: Radio One, Inc.
    Case Study: Radio One, Inc. - Part A Corporate Valuation Date: 21-09-2009 Instructor: Dr. Oliver Spalt Course: 323058 Corporate Valuation Faculty Economics and Business Administration, Tilburg University P.W. Segers J.J.T.M. Zegers 779710 722085 1. Radio One’s opportunities and risks with respect to their acquisition policy We have identified four main benefits and five major risks with respect to the desired acquisition of 12 urban stations along with the nine stations in...
    2,476 Words | 7 Pages
  • Boston Beer Company - 716 Words
    Boston Beer Company- Case Analysis You are the investment banker assigned with the task of setting the IPO price for Boston Beer Company (BBC). Prepare a research report to support your recommendation. As you prepare this report, you may find that you would like to have more field information than what the case offers you. However, the case contains critical information that gives you a reasonable basis to compute its valuation. In addition use the following information for 1995.1 Sales ($...
    716 Words | 2 Pages
  • Harris Seafood Assignment 2
    Harris Seafood Answer the following questions a. Should Harris Seafoods enter the shrimp processing business by building the new plant? Please assume the firm will be unable to use the Industrial Revenue Bond financing mentioned at the end of the case (we will return to this topic in a later case). Yes, I think that this company should build a new plant that allows them to grow in the industry, even if they are unable to use the Industrial Revenue Bond, they will have other financing...
    961 Words | 4 Pages
  • INTERCO Case Study Memo (due start of class 9/16)
    INTERCO Case Study Memo (due start of class 9/16) 1. Assess Interco’s financial performance. Why is Interco a target of a hostile takeover attempt? 2. As a member of Interco’s board, you are presented a historical “Premiums Paid Analysis” in Exhibit 10. This “Premiums Paid Analysis” documents, for a sample of other companies over the past year, how large the takeover offer was relative to the target’s stock price before the offer was announced. Do you find this historical data useful in...
    583 Words | 2 Pages
  • Western Harbour Crossing - 2670 Words
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