Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Instructions Choose a publicly traded company withat least one year of trading history and one set of annual financial statements. Using Microsoft Word, answer the

Instructions

Choose a publicly traded company withat least one year of trading history and one set of annual financial statements. Using Microsoft Word, answer the following questions in 12 point Arial or Times New Roman font. The completed assignment should be about 1500 words, not counting titles, references or long quotations in length. Use APA formating, and be sure to cite your references.

Part 1:Corporate Structure and Governance

Is this a company where there is a separation between management and ownership? If so, how responsive is management to stockholders?

What potential conflicts of interest appear to exist?

How does this firm interact with financial markets?

Part 2:Measuring Investment Returns

Is there a typical project for this firm? If so, what is its life (short term or long term)? What are its investment needs and cash flow patterns?

What current projects are underway?

What future projects are projected? How do they compare to current projects?

Part 3:Capital Structure Choices

What are the different kinds or types of financing that this company has used to raise funds? Where do they fall in the continuum between debt and equity?

How large, in qualitative or quantitative terms, are the advantages to this company from using debt?

How large, in qualitative or quantitative terms, are the disadvantages to this company from using debt?

From the qualitative standpoint, does it appear that this firm has too much or too little debt? Or does it appear to have an optimal level of debt?

Part 4:Dividend Policy

How has this company returned cash to its owners? Has it paid dividends or bought back stock?

How much cash has the firm accounted over time?

Given the firms current position, how would you recommend that it return cash to stockholders (assuming that excess cash exists)?

How much cash could this firm have returned to its stockholders over the past few years? How much did it actually return?

Part 5: Valuation

What growth pattern does this firm appear to be in (growth, stability, etc)? If growing, how long would you predict this growth to last?

What is your estimate of value of equity in this firm?

What is the key variable driving this value (risk, growth, leverage, profit margins, etc)?

If you were hired to enhance value at this firm, what path would you choose?

Post your results in an MS WORD DOC and be sure to check your APA formatting.

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Advanced Accounting

Authors: Gail Fayerman

1st Canadian Edition

9781118774113, 1118774116, 111803791X, 978-1118037911

More Books

Students also viewed these Finance questions

Question

How many milliliters are in 607.8 kL?

Answered: 1 week ago

Question

1. What will happen in the future

Answered: 1 week ago

Question

3. Avoid making mistakes when reaching our goals

Answered: 1 week ago