Question
1.The Weighted Average Cost of Capital (WACC) for a firm can be calculated or found through research. Select two firms in the same industry. The
1.The Weighted Average Cost of Capital (WACC) for a firm can be calculated or found through research. Select two firms in the same industry. The industry may be that in which you currently work or it may be an industry in which you are interested. Calculate or find the WACC for the two firms. How do the WACCs compare? Are the WACCs what you would expect? What causes the differences between the two firms' WACCs?
2.what is the most difficult part of calculating WACC?
3.Our second discussion topic concerns the calculation of stock values using the Capital Asset Pricing Model (CAPM). We will start with a discussion of risk and work towards practical application of the model. The textbook provides a list of betas for a selection of stocks. Choose a few firms from that list and discuss whether the betas are what you would expect. Be sure to explain why or why not.
4.
Sprint Corporation (NYSE) is showing promising figures in terms of its rankings among the major telecommunication giants like AT&T, Verizon and T-Mobile, with the latest release of metrics that reflect higher than expected rating regarding calls and texting reliability and performance and has received numerous other first, second standing in overall reliability, speed and data and texting network capability.
Sprint Corp (NYSE:S)
Weighted Average Cost Of Capital (WACC) 7.74%
Here are the current Sprint Stock Ratios according to Yahoo Finance:
Sprint Corporation (S) -NYSE
4.42 Down 0.04(0.90%) Jun 5, 4:00PM EDT
After Hours: 4.43 Up 0.01 (0.23%) Jun 5, 7:47PM EDT
SPRINT Corporation (S)
Beta: -1.355
52wk Range: 3.79 - 8.96
Volume: 12,789,376
Market Cap: 17.53B
EPS (ttm): -0.85
In the past twelve months price to sales ratio recorded as 0.54 and price to cash ratio remained 4.48
Although it has a negative beta, its recent awards, and investments and its recent teaming up with Google to provide new wireless service may boost the stock, the numbers are conflicting for Sprint, my guess is that it may make a significant turnaround in 2016 and those numbers may change more positively to reflect the companys potential in the future.
Negative Betas, while rare, signify a negative correlation. When the market goes up, we would expect the stock price to go down.
Has Sprint's performance over the last 2 years been consistent with its negative beta?
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started