(3) Estimate Capital Structure (25 points)
- Estimate the firm's weights of debt, preferred stock, and common stock using the firm's balance sheet (book value).
- Estimate the firm's weights of debt, preferred stock, and common stock using the market value of each capital component.
(4) Compute Weighted Average Cost of Capital (WACC) (35 points)
- Estimate the firm's before-tax and after-tax component cost of debt; (Note: If the information about the current corporate tax rate is not available, you need to estimate the tax rate based on the historical tax payments).
- Estimate the firm's component cost of preferred stock if the firm has issued preferred stocks.
- Use three approaches (CAPM, DCF, bond-yield-plus-risk-premium) to estimate the component cost of common equity for the firm.
- Calculate the firm's weighted average cost of capital (WACC) using the market-based capital weights.
Cemex S.A.B. de C.V. (CX) M MERGENT by FTSE Russell Materials & Processing/Cement Price: $4.68 Report Date: November 27, 2020 Annual Ratios Fiscal Year End: December Profitability 2019 2018 2017 2016 201 Gross Profit % 32.0 34.2 34.7 34.4 33.2 EBITDA Margin % 15.0 15.7 17.3 18.6 16.8 Operating Margin % 7.3 10.0 11.4 12.9 10.5 Tax Rate % 78.9 30.3 2.6 19.0 34.4 Pretax Margin % 1.5 5.4 5.2 6.3 1.3 Net Profit Margin % 0.5 12.2 14.8 16.2 0.4 Interest Coverage Return on Equity % 1.9 18.3 22.1 26.9 0.6 Return on Total Equity 0.7 18.3 22.1 26.9 0.6 Return on Capital % 0.5 12.9 15.5 17.5 0.4 Return on Assets % 0.2 1.1 69 7.2 0.2 Return on Invested Capital % 15 7.3 11.6 11.3 1.7 Liquidity & Leverage 2019 2018 2017 2016 201 Days Inventory (DOH) 40 41 39 36 40 Days Receivable (DSO) Days Payable (DP) 101 97 95 124 111 Sales / Employee ($ Thou) 322.0 352.0 327.0 316.0 316.0 Net Income / Employee ($ Thou) 2.0 43.0 48.0 51.0 1.0 Capital Expenditures / Sales 4.8 4.1 4.0 1.6 3.6 Asset Turnover 0.5 0.0 0.5 0.5 04 Receivable Turnover Inventory Turnover 9.2 8.8 9.4 10.2 9.2 Plant & Equipment Turnover 1.1 1.3 1.2 1.2 1.1 Cash / Total Capital 7.3 2.8 6.5 5.9 9.3 Quick Ratio Current Ratio 0.9 0.8 0.6 1.1 1.0 Net Working Capital -830.0 -1,164.0 2,072.0 479.0 53.0 Long Term Debt / Equity % 100.0 100.0 100.0 100.0 100.0 Long Term Debt / Capital % 48.9 46.9 47.4 57.0 60.6 Total Debt / Common Equity % 125.3 109.8 125.4 160.8 183.6 Total Debt / Total Capital % 55.7 50.2 56.5 59.8 64.4 Long Term Debt / Market Value % 0.0 0.0 0.0 0.0 0.0 Total Debt / Assets % 40.2 1.9 39.8 45.7 49.5 Cash Flow 2019 2018 2017 2016 201 Operating Cash Flow TTM Operating Cash Flow Per Share TTM 0.64 0.56 0.62 0.70 0.22 Free Cash Flow Per Share TTM 0.41 0.16 0.23 0.39 0.14 Cash Dividend Coverage Cash Realization Ratio 19.54 0.77 0.78 0.85 21.09 Asset Replacement Ratio 62.3 72.4 67.2 27.9 57.7Cemex S.A.B. de C.V. (CX) M MERGENT Materials & Processing Cement Price: $4.68 Report Dain: November 27, 2020 Summary Annual Financials Fiscal Year End: Docamber Income Statement 2018 2012 2017 2018 201 Total Revenue (SM) 13,130.0 14 079 2 13,103.0 12,126.2 12 994 3 Direct Operating Expenses 8 825.0 0.304.5 8,605.7 7 823.7 8.655.6 Greas Profit 4.3050 4.7747 4 497 3 4 3026 4.3587 Selling General & Admin Exp 2.9720 3.086 5 28439 2.598 3 2.7989 Research & Development (Up Exp) Operating Income ($M) 1.391.3 1.459.7 1.624.7 1,365.4 Interest Expense (Income], Net Income (Continuing) Before Tax 204 0 755 6 683 5 801 8 155 6 Income Tax 1620 227 2 26.4 149.6 1310 Net Income 143.0 532.3 772.6 678.2 69.1 Diluted EPS OO0 0.01 0.02 0.02 Operating EPS 0.04 0.38 0.44 0.52 0.01 Shares - Wild Average - Diluted (000) 47 322.141 48.014.740 48 438,607 47 516.800 47 083.605 Dividends Per Share Balance Sheet 2018 2018 2017 2018 201 Cash, Cash Equivalents & Short Term Inv (5M) 788 0 308 6 6075 558 4 879 6 Accounts & Notes Receivable 1,5210 1,487 4 1,547.1 1,4474 1.598.7 Total Current Assets 4.5790 3.420.4 3 622.6 4 447.7 4.240.3 Property, Plant & Equipment - Not 11,850.0 11.413.7 11,784.7 10,976.1 12,326.0 Investments 717 0 750 8 727 4 847 4 1 076 4 Goodwill - Net 11 850 0 11 4137 11 7847 10 978 1 12.326 0 Total Accato 25,104.4 28 8110 28,854.4 31,214.1 Accounts Payable & Accrued Expenses 2 526.0 26349 2.256.7 3.013.6 2,840.1 Debt & Capital Lease Obligations (ST) 1,443.0 692.7 1 844.4 622 2 909 8 Total Cumant Liabilities 5400.0 4.584 5 5,604.3 3.068.6 4.1776 Debt & Capital Leaks Obligations (LT) 10 3470 9,8709 9.6386 126134 14.528 4 Minority Interest (BS) 1.503 0 1.5705 1.567 5 1.399 2 1.167 9 Total LIEbillties 20 0420 20 378.0 27 865.1 Total Common Equity 9.3210 9 593.6 9.1136 8.108.4 8 259 0 Preferred Share Capital Itookholdarc' Equity 8.4210 8.1128 3.108.4 Shares Outstanding (000) 45.321 394 45.003.912 45.321.705 42 182 375 42 018 906 Cash Flow Statement 2018 2018 2017 2018 201 Net Income (SM) 179 0 5724 8446 7349 122 8 Depreciation & Amortization 1,0450 817 2 8118 7804 685.1 Working Capital - Change -540 532.7 2040 Cash From Sale of Goods & Services Cash Paid to Employees & Suppliers Cach Flows from Operating Activities 1,146.8 1,678 2 1 858.2 1,083.2 Copyright 6 2020 FTSE Russell Cash Flow Statement (cont] 2018 2013 2017 2018 201 Property, Plant & Equipment - Purchase 651 0 591.5 5458 217 5 510.7 Purchasn of Investments Property Plant & Equipment - Proceeds Acquisition & Divestiture of Business - Net Disposal of Investments Cach Flows from Investing Aotivitlec -284.0 -787.7 -281_0 -453 2 Short Term Borrowings - Change Net Change in Long Term Debt & Capital Sec -56.0 19 9 12 5 193 532 Net Change in Equity -50.0 -773 472 5 Payment of Dividends -150.0 Cuch Flows from Financing Activities -6440 -2.180.7 -1,814.7 -717.8 Effort of Exch Rate on Cash & Cash Equiv Cash & Cash Equivalents - Beginning 309 0 698 8 589 6 7385 724 7 Cuch & Cuch Equivalents - End 780.0 560.4 878 8
