I need help preparing a financial analysis for the Bayer Corporation and Monsanto Corporation for the 3rd Milestone of this project. I have attached the material.

BUS 505: Final Project Document Overview & Rubric Your final project for this course is to prepare a financial analysis. This final project takes a close look at two corporations, Bayer and Monsanto. Bayer is considering a bid for United States seed company Monsanto (Snider, 2016). For purposes of this project, you will act as the Chief Financial Officer of Monsanto Corporation, analyzing financial documents and determining whether Monsanto should indeed go forward with acceptance of the purchase. The project is divided into three milestones, which will be submitted at various points throughout the course to scaffold learning and ensure quality final submissions. Preliminary milestones will be submitted in Modules Four and Six. The final submission will occur in Module Eight. Milestone 1: Evaluation of the Proposal Due in Module 4 Milestone 2: Evaluation of an Alternative Opportunity Due in Module 6 Milestone 3: Final Project Submission Due in Module 8 In this assignment you will demonstrate your mastery of the following course outcomes: [CO1] Analyze financial reports to determine a firm's performance. [CO2] Apply the strategic planning processes necessary to manage the long- and short-term financial activities of the firm. [CO3] Perform valuation of financial instruments. [CO4] Evaluate the appropriateness of an investment using applicable economic, industry, and competitive analysis. Background Information (applies to Milestones One through Three): Bayer is a life science firm with a more than 150-year history and core competencies in the areas of healthcare and agriculture. With its innovative products, it contributes to finding solutions major challenges, such as a growing and aging world population requiring improved medical care and an adequate supply of food. Bayer addresses these issues by preventing, alleviating and treating diseases, and helping to provide a reliable supply of high-quality food, feed and plant-based raw materials. Bayer Pharmaceutical is Bayer's largest division in terms of total sales. This division focuses on researching, developing and marketing innovative medicines with a positive cost-benefit ratio primarily in the therapeutic areas of cardiology, oncology, gynecology, hematology and ophthalmology. To safeguard long-term growth, Bayer is currently seeking increase its investment in research and development. Besides expanding early research, Bayer is concentrating on the clinical development of active drug substance candidates in the therapeutic areas of cardiology, oncology, hematology and gynecology. In addition, it is selectively expanding and supplementing its development portfolio through licensing agreements and acquisitions. The Crop Science Division of Bayer, on the other hand, focuses on improvement in agricultural sustainability, crop yields and quality, as well as the leveraging of digitization to help make products safer (Bayer, 2016). Bayer's aim is to help shape the future of the agricultural industry with innovative offerings that increase its productivity, thus generating profitable and sustainable growth for Crop Science and its customers and enabling the production of sufficient food, animal feed and renewable raw materials for a growing world population despite the limited amount of available arable land. This strategy is complementary to its Animal Science Division, which produces animal feed products. Bayer Crop Science Division's current strategy is to enhance its Crop Protection and Environmental Science portfolio, expand its Seeds business, and to lead the way in innovation and develop holistic solution (Bayer AG, 2016). For purposes of this discussion, assume that Bayer aims to build on its expertise in the integration of seed technology with chemical and biological crop protection. For purposes of this project, assume that Bayer is seeking to acquire Monsanto Corporation. Monsanto, along with its subsidiaries, is a leading global provider of agricultural products for farmers. Through its seeds, biotechnology-trait products, herbicides and precision agriculture tools, Monsanto (Monsanto, 2016) seeks to provide farmers with solutions that help improve productivity, reduce the costs of farming and produce better foods for consumers and better feed for animals. Monsanto has a worldwide distribution, sales and marketing organization for its agricultural-productivity products. In a growing number of locations throughout the world, it produces directly or contracts with third-party growers for corn seed, soybean, vegetable, cotton, canola and other seeds. The global market for its \"Seeds and Genomics\" segment is increasingly competitive. Both its row crops and its vegetable seed businesses compete with numerous multinational agrichemical and seed marketers globally, and with hundreds of smaller companies regionally. Bayer's proposal would pair Monsanto, the world's largest seed company, with drug-maker Bayer's growing seed and crop protection portfolio. Upon announcement of the possibility of such a bid, shares of St. Louis-based Monsanto (MON) rose by 8.7% (Kirchfield, et. al., 2016). Across 2015, immediately following announcement of a possible merger between the two firms, Bayer's growing agribusiness division saw sales rise 9% to $11.8 billion, while its healthcare sales rose 19% to $26 billion, as market participants reacted to news of the possible merger. Overall, Bayer's 2015 sales rose 12%, to $52.8 billion (Business Wire, 2014). On the other hand, Monsanto, which makes seeds (corn, cotton, fruits and other vegetables) and crop protection chemicals such as RoundUp, reported sales of $15 billion in its 2015 fiscal year. This was a 5% decline from the previous year (Daily Management Review, 2016). See Table 1, below, for an alternative view of these results. Prompt: In this project, you will assume that Bayer is considering a bid for United States seed company Monsanto (Snider, 2016). For purposes of this project, assume that you are Chief Financial Officer of Monsanto Corporation. Bayer's proposal would pair Monsanto, the world's largest seed company, with drug maker Bayer's growing seed and crop protection portfolio. Upon announcement of the possibility of such a bid, shares of St. Louis-based Monsanto (MON) rose by 8.7% (Kirchfield, et. al., 2016). Across 2015, immediately following announcement of a possible merger between the two firms, Bayer's growing agribusiness division saw sales rise 9% to $11.8 billion, while its healthcare sales rose 19% to $26 billion. Overall, Bayer's 2015 sales rose 12%, to $52.8 billion (Business Wire, 2014). On the other hand, Monsanto, which makes seeds (corn, cotton, fruits and other vegetables) and crop protection chemicals such as RoundUp, reported sales of $15 billion in its 2015 fiscal year. This was a 5% decline from the previous year (Daily Management Review, 2016). Assume that Monsanto is taxed (TC) at a rate of 35% and its cost of debt (RD) is 12%. See Table 1, below, for an alternative view of this data. In the context of Bayer's proposal, assume that Bayer's Beta is 1.24. For purposes of valuation of cash flows in the context of Bayer's proposal, consider Monsanto's discounted cash flow for only the upcoming 1 year of sales, and assume that Monsanto is expected to grow at a rate of 3% in the current year. Assume also that Monsanto's current sales are projected to be $15,239,000, while its equity holdings are estimated to be $9,141,333 and its debt is $12,359,333. Assume that Monsanto's Profit Margins and Total Asset Turnover are unchanged from 2015 levels. EBIT, depreciation, capital spending, and the change in net working capital will grow at the same rate as sales, which is expected to grow at a rate of 3% across this year, while capital investment will remain stable As an alternative proposal means of increasing shareholder value, as Chief Financial Officer of Monsanto, you have also been asked to evaluate a management proposal to expand Monsanto's existing operations to pesticide production, yielding an increase in sales of $3,950,000. In the context of this alternative proposal, assume that there is no excess capacity, and the increase in fixed asset needs would be equal to 70% of this increase in sales, while cost of sales would run 20% of sales, using a percentage of sales approach. Also assume that Monsanto issues dividends at a rate of 1.98% of net sales, and thus the firm's retention ratio is 98.2%. Assume that Monsanto's current total level of sales is $15,239,000, while the division involved in this project is expected to yield sales of $2,950,000 in the current year. .Assume that the proposed project has a risk and weighted average cost of capital similar to that of Monsanto, and a firm beta similar to that of Monsanto. Upon receipt of Bayer's proposal, your company's Board of Directors has directed you, as Chief Financial Officer of Monsanto Corporation, to review key statistics and other information and report to the Board on the following: 1. Taking account of background information and other information supplied here, determine whether to accept or reject this proposal for $62B. For purposes of this analysis, consider discounted adjusted cash flow for only the current year, in which the firm is anticipated to grow at a rate of 3%. Evaluate each of the following: a. From given information (Table 7 will aid you in making these calculations, and has been provided for this purpose): (i) Ascertain Monsanto's weighted average cost of capital (WACC) and use this along with the firm's growth rate to determine the discounted value of adjusted cash flows. Employ the discounted value of adjusted cash flows to determine how this offer compares to the present value of the firm's adjusted cash flow (CFA*), using the firm's WACC. (ii) Explain the importance that this has for the firm, and for shareholders, noting that this is an issue which you have not covered in previous Milestones - and thus you will use this additional measure alongside measures prepared in Milestone One, as you complete Milestone Three. Use information from all assigned readings to support your analyses. b. Justify your decision to accept or reject this offer using additional evidence drawn from ratio analysis, financial statement analysis, or time and trend analysis, refining your Milestone One analyses as applicable, given information covered in subsequent modules, and given current sales, equity and debt information included here. 2. With respect to the firm's alternative proposal, determine: a. The extent to which Monsanto will have to take on additional debt, given that it wishes to retain its current dividend ratio and does not wish to sell additional equities. b. Calculate the firm's sustainable growth rate and internal growth rate and use these measures to analyze a decision to accept this alternative proposal. Use these measures and concepts covered in assigned readings including EFN, DuPont Identity and leverage, Modules One through Eight, to explain the importance of these measures to shareholder interests. Use evidence and assigned readings covered to this point to support your determinations. Present your analysis in a 4-6 page double-spaced document using 12 pt. Times New Roman font. Use APA formatting. References Bayer. (2016). Bayer Global Annual Report. Bayer AG (2016). Bayer: Science for a better life. Bloomberg. (2016). United States rates and bonds. Business Wire. (2014). Merck Announces Sale of Consumer Care Business to Bayer AG for $14.2 Billion . Berkshire Hathaway Business Wire. Daily Management Review. (2016). Reports of Takeover Interests Causes Monsanto Shares to Jump. Daily Management Review. Kirchfield, A., David, R. and Nair, D. (2016). Bayer considers the offer of Monsanto. Bloomberg News. Monsanto (2016). Annual Report. Snider, M. (2016). Chemical firm Bayer makes $62B offer for Monsanto. USA Today. ValuePro. (2016). ValuePro. Yahoo Finance. (2016). MON cash flow. Yahoo Finance. (2016). MON balance sheet. Yahoo Finance. (2016). MON income statement annual. Immediate Results from the Bayer Announcement in 2015 Monsanto (MON) Share Price Increased 8.7% Bayer Crop Science Division Sales increased 9% to $11.8 billion Bayer Healthcare Division Sales Increased 19% to $26 billion Bayer Pharmaceutical Sales Increased 12%, to $52.8 billion Monsanto Sales Decreased 5% to $15 billion Table 1 Immediate Results from the Bayer Announcement in 2015 ValuPro Net Online Valuation of MONSANTO CORPORATION - 2015 Return on Assets 8.56 Return on Equity 14.93 Sales ($mil) 14,757 Investment Rate (% of Rev) 4.78 Growth Rate (%) 13.5 Working Capital (% of Rev) 29.19 Net Oper. Profit Margin (%) 21.3 Short-Term Assets ($mil) 11141 Tax Rate (%) 30.584 Short-Term Liab. ($mil) 4055 Stock Price ($) 86.74 Equity Risk Premium (%) 3 Shares Outstanding (mil) 533.8 Company Beta 1.05 10-Yr Treasury Yield (%) 500% Value Debt Out. ($mil) 2.054 Bond Spread Treasury (%) 1.5 Value Pref. Stock Out. ($mil) 0 Preferred Stock Yield (%) 7.5 Company WACC (%) Table 2 ValuePro Net Online Valuation Monsanto Co. 2015 (Bloomberg Market Rates) MON:US Current Price 106.00 (USD) Open 106.80 Day Range 109.69-109.54 Volume 18,049,774 Previous Close 106 52 Week Range 81.22-120 1 Year Return -7.06% YTD Return 10.94% Current P/E Ratio (TTM) 23.67 8% Earnings Per Share (USD) (TTM) 4.62 Market Cap (B USD) 47.747 Shares Outstanding 436.845 Price/Sales (TTM) 3.65 Dividend Indicated Gross Yield 1.98% Sector Materials Industry Chemicals Sub-Industry Agricultural Chemicals Table 3 Monsanto Co. Rates Income Statement - Monsanto Corp. Period Ending 31-Aug-15 31-Aug-14 31-Aug-13 Total Sales 15,001,000 15,855,000 14,861,000 Cost of Sales 6,819,000 7,281,000 7,208,000 Gross Profit 8,182,000 8,574,000 7,653,000 Research Development 1,580,000 1,725,000 1,533,000 Selling General and Administrative 2,686,000 2,774,000 2,550,000 Non Recurring 393,000 - - Others - - - Total Operating Expenses - - - 3,523,000 4,075,000 3,570,000 - 31,000 Operating Expenses Operating Income or Loss Income from Continuing Operations Total Other 71,000 Income/Expenses Net Earnings Before Interest and Taxes 3,594,000 4,075,000 3,601,000 Interest Expense 433,000 248,000 172,000 Income Before Tax 3,161,000 3,827,000 3,429,000 Income Tax Expense 864,000 1,078,000 915,000 Minority Interest -11,000 -22,000 -43,000 Net Income from Continuing Ops 2,286,000 2,727,000 2,471,000 Discontinued Operations 28,000 13,000 11,000 Extraordinary Items - - - Effect of Accounting Changes - - - Other Items - - - 2,314,000 2,740,000 2,482,000 - - - 2,314,000 2,740,000 2,482,000 31-Aug-15 31-Aug-14 31-Aug-13 Cash and Cash Equivalents 3,701,000 2,367,000 3,668,000 Short Term Investments 47,000 40,000 254,000 Net Receivables 3,182,000 3,466,000 3,042,000 Inventory 3,496,000 3,597,000 2,947,000 Other Current Assets 199,000 205,000 166,000 Non-recurring Events Net Income Preferred Stock and Other Adjustments Net Income Applicable to Common Shares Table 4 Monsanto Income Statement Balance Sheet - Monsanto Corp. Period Ending Assets Current Assets Total Current Assets 10,625,000 9,675,000 10,077,000 Long Term Investments 42,000 92,000 237,000 Property Plant and Equipment 4,973,000 5,082,000 4,654,000 Goodwill 4,061,000 4,319,000 3,520,000 Intangible Assets 1,332,000 1,554,000 1,226,000 Accumulated Amortization - - - Other Assets 610,000 746,000 496,000 Deferred Long Term Asset Charges 277,000 450,000 454,000 Total Assets 21,920,000 21,918,000 20,664,000 Liabilities Current Liabilities Accounts Payable 4,359,000 3,756,000 Short/Current Long Term 687,000 Debt 315,000 63,000 Other Current Liabilities 438,000 517,000 Total Liabilities 3,950,000 540,000 14,930,000 14,043,000 8,105,000 Stockholders' Equity Misc. Stocks Options Warrants - - - Redeemable Preferred Stock - - - Preferred Stock - - - Common Stock 6,000 6,000 6,000 Retained Earnings 10,374,000 9,012,000 Treasury Stock -4,140,000 12,053,000 10,032,000 Capital Surplus 11,464,000 10,003,000 10,783,000 7,188,000 Other Stockholder Equity -2,801,000 -1,114,000 -1,278,000 Total Stockholder Equity 6,990,000 7,875,000 12,559,000 Net Tangible Assets 1,597,000 2,002,000 7,813,000 Table 5 Monsanto Balance Sheet Cash Flow - Monsanto Corp. Period Ending 31-Aug-15 31-Aug-14 31-Aug-13 Net Income 2,314,000 2,740,000 2,482,000 Operating Activities, Cash Flows Provided By or Used In Depreciation 716,000 691,000 615,000 Adjustments to Net Income 240,000 233,000 113,000 Changes in Accounts Receivables 68,000 -172,000 222,000 Changes in Liabilities 457,000 482,000 -129,000 Changes in Inventories -425,000 -650,000 -192,000 Changes in Other Operating Activities -273,000 -292,000 -414,000 Total Cash Flow from Operating Activities 3,108,000 3,054,000 2,740,000 Investing Activities, Cash Flows Provided By or Used In Capital Expenditures -967,000 -1,005,000 -741,000 Investments 4,000 235,000 Other Cash Flows from Investing Activities -56,000 Total Cash Flows from Investing Activities 217,000 -1,235,000 -253,000 -1,019,000 -2,095,000 -777,000 Financing Activities, Cash Flows Provided by or Used in Dividends Paid -966,000 -932,000 -976,000 Sale Purchase of Stock -698,000 -6,834,000 -705,000 Net Borrowings 1,238,000 -5,536,000 127,000 Other Cash Flows from Financing Activities -36,000 -48,000 -10,000 Total Cash Flows from Financing Activities -430,000 -2,259,000 -1,485,000 Effect of Exchange Rate Changes -325,000 -1,000 -93,000 Change In Cash and Cash Equivalents 1,334,000 -1,301,000 385,000 Table 6 Monsanto Statement of Cash Flows Valuation Component Previous 3-Year Average EBIT $ 3,511,347 Depreciation $ 674,000 Taxes* $ 1,228,971 Change in NWC $ 227,911 Capital Spending $ (1,000,000) CFA* $ 3,728,464 Year 1 Firm Value Note that all values are in thousands. This table may be used to present your NPV calculations. Discount factor Discounted CFA* NPV $ 12,359,933 NPV-Debt Debt Table 7 Monsanto Firm Valuation Using Average Expected Sales Based on 3-Year Average of Previous Results Should Bayer Acquire Monsato? Kerry McCormick Professor Paulone Finance BUS 505 July 22, 2017 \"Bayer: Science for a Better life\" is a globally recognized organization with core competences in the Life Science fields of health care and agriculture (Bayer, n.d.). Monsanto is a global moder agricultural company developing products and tools to help farmers around the world to grow crops while using energy, water and land more efficiently (Monsanto, n.d.). As we take a look at the parallels of these organizations, would it be economically advantageous for Bayer to acquire Monsanto? We need to carefully evaluate the whole company, the culture, the performance and the potential for future growth. In a message from Hugh Grant, the Monsanto Chairman and CEO, he addresses his thoughts about potentially merging with Bayer and how the two companies are like minded in that they share the understanding of the world's sustainability challenges. Joining forces with Bayer is the right move for Monsanto, they are culturally similar, now let us look to see if it is the right move for Bayer. Monsanto had approached Bayer to initiate this merger, this acquisition would be worth more than $30 billion. The merger would pair Bayer's growing seed and crop protection portfolio with Monsanto the world's largest seed company (Daily Management Review, 2016). The initial bid was $62 billion, and as the CFO of Monsanto, I am here to demonstrate why this will be a solid acquisition. From the moment that the rumors hit Wall Street, the Stock Price already saw an increase in 8.7 percent, despite the 5% drop in sales over the past year. This tells us as a partnership this will have a strong presence, especially on Wall Street. The two companies can strengthen each other where they are falling short. Reputation however is not going to pay the bills, and will only get the two organizations so far. Looking into Monsanto's liquidity is important, since this is the actual cash a company will have on hand to take care of their unexpected expenses, without having to rely on External Financing (Ross, 2013). The ideal rate of a company should be at 1.1, and most recently Monsanto was at .71 in August 2015. This is not ideal, but it is a significant improvement from their ratio .49 in August 2013 and .44 in August 2014. These numbers will require an investigation as to why they are so low, perhaps it is the timing of accounts receivables. Improvement is needed. The quick ratio, which is based on the current assets minus the inventory divided by the current liabilities is not ideal either. In 2013, they are at .87 in 2014 .28 and 2015 .48. This is showing that they are utilizing their assets to pay their debts and therefore are not effectively utilizing their assets. This area needs significant improvement. Moving into how Monsanto generates profits and revenues. One indicator of this is how well the company is managing their inventory and looking at their inventory turnover ratio. To determine this ratio we take the cost of the goods sold and divide it by the inventory on hand. We want to see a higher number here, to show that the company has a lower level of inventory on hand, that their inventory has been sold. Monsanto's numbers are low. 2013 2.45, 2014 2.03 and in 2015 1.95. Asset Turnover Ratio which is the amount of money earned per dollar of assets. This can be of the most concern to Bayer. Monsanto's ratio .72 in 2013, .72 in 2014 and .68 in 2015 shows that they have a significant problem managing their assets. Debt Equity Ratio which should not exceed 4 or 5 percent, Monsanto fell below this line, mainly because they used their own assets to pay their debts. In 2013 .80, 2014 1.23 and 2015 1.53. This makes them attractive to both investors and lenders. The P/E ratio determines the price per share divided by earnings per share ( Ross, 2013). Monsanto's current P/E ratio is 23.67 and makes them a relatively attractive stock buy, and good investment for stock holders. This ratio is still somewhat low, and may lead the company to needing more capital down the line. The WACC for Monsanto is 8%, which is the weighted average cost of capital which is the cost of equity and the after tax cost of debt (Ross, 2013). Since Bayer and Monsanto are both in similar Sectors we can apply the WACC since we only utilize this for Peer group markers. The SIC code for Agriculture and Production is 01. Monsanto can certainly use the help in some areas, such as inventory control and better use of assets. Joining forces with Bayer will certainly create the strength that they will need to turn that 3 percent projected growth into a significantly higher number. Bayer, in looking at the entire picture, including the industry, will notice that Monsanto is right in line with everyone else (Monsanto). They are not in debt, absolutely they do have their weaknesses, which can be pointed out in the SWOT analysis. Joining forces with this environmentally progressive organization, will allow Bayer to grow this arm of their organization, further increasing their wealth. The problems that Monsanto are facing are not detrimental and under the right financial leadership, can certainly be altered. We see that a rumor bumped up the stock price, image what an actual acquisition would do. References: Bayer (n.d.) retrieved from bayer.com Daily Management Review (2016) Reports of Takeover Interests Case Shares to Jump. Retrieved from: Daily Management Review Monsanto (n.d.) retrieved from Monsanto.com Monsanto (n.d.) retrived from reuters.com Ross, S. (2013) Fundamentals of Corporate Finance. McGraw Hill. 11e Should Bayer Acquire Monsato? Milestone II Kerry McCormick Professor Paulone Finance BUS 505 August 4, 2017 Evaluation of an alternative opportunity Bayer is entering into a territory that strikes fear into many people. Monsanto, has been on the receiving end of many articles siting them as the creator of \"FrankenFoods\" and feeding genetically modified corn and other products to our families for years (Parloff, 2010). According to this article, the genetically modified seeds are under patent and these patents will not expire until 2020, making them an attractive partner for Bayer. This merger will put them in the race with DuPont, who sells their genetically modified seeds through its subsidiary Pioneer Hi-Bred International. As an alternative proposal to increase shareholder value, Monsanto's aim is to investigate another option that will not decrease offers in the firm. The plan is to extend its operations into pesticide generation, which will yield a sales increase of $3,950,000. There is no excess capacity and the fixed asset needs equaling 70% increasing of sales, which run 20% of offers. Monsanto issues dividends at 1.98% of net sales creating a retention rate of 98.2%. Current sales are on target for $15,239,000. The company would be expanded by $2,765,000, calculated from 70% of $3,950,000. Bayer does not want to offer value, and will try to subsidize through obligation. The statement of income will be adjusted for the changes in the increase in sales. Total Sales 15,239,000 Cost of Sales (20%) 3,047,800 Gross Profit 12,191,200 The gross profit is expected to increase to $12,191,200 just from the obligation of merging with Bayer Corporation. This increase is a very good indication that the two companies coming together would be beneficial. Calculating the External Financing Needed (EFN) will be the next step (Ross, 2013). Monsanto will have to seek outside financing, since it wants to retain its current dividend ratio and does not want to sell additional equities. Using a combination of short and long-term debt here may be a possible strategy to offset the costs. EFN= Ao Lo So (S1-So)- So (S1-So)-(PM) (S1) (b) So - Current Sales 15,239,000 S1=forecasted sales=s0 (1+g) =$15,239,000(1+3%) =$15696170 g= forecasted growth rate in sales=3% Lo=liabilities=$ 12,359,333 PM=profit margin=0.55 b=retention ratio=1.98% Ao So (S1-So)=required increase in assets=$2,765,000 $ 12,359,333 EFN=$2,765,000- $ 15,239,000 ($15696170-$15,239,000)-(0.55) ($15696170)( 1.98%) Total External Financing Needed is $2,223,288.72. The Sustainable Growth Rate is the maximum growth rate a firm can achieve without external financing while maintaining a constant debt-equity ratio. This is an important value to analyze since it measures how much a company can grow on its own without incurring additional debt. Sustainable growth rate = Return on equity *(1-dividend payout ratio) =14.93%*(1-1.98%)=14.63% Monsanto can grow at a maximum rate of 14.63% without needing external financing. Internal Growth rate is the rate of interest that can be achieved without any external financing of any kind. This shows investors the strength of the company's ability to fund the company from within. Internal Growth Rate= ROAb 1(ROAb) ROA - Return on Assets, b - Retention Ratio IGR= 10.56 98.2 1(10.56 98.2 ) =11.57% Monsanto has the ability to expand at a maximum rate of 11.57% per year without external financing. Challenges: One thought that I had while conducting research on these companies, and attempting these figures, Monsanto clearly benefited from the initial talks of the acquisition of Bayer as it is relayed on the balance sheet. Wall Street responded to the rumors accordingly. How would a financial analyst factor that into Growth Rate and EFN not knowing how their performance is actually going to translate. With all of the negative press, and strong feelings, could it be said that this momentary surge in the stock market go back to where they were, and worse, drag Bayer with them? What do you do in that case? References: Bayer (n.d.) retrieved from bayer.com Daily Management Review (2016) Reports of Takeover Interests Case Shares to Jump. Retrieved from: Daily Management Review Monsanto (n.d.) retrieved from Monsanto.com Monsanto (n.d.) retrived from reuters.com Parloff, R. (2010) Monsanto's seeds of discord. Fortune. Ross, S. (2013) Fundamentals of Corporate Finance. McGraw Hill. 11e