Step 2: Determine Corporate Valuation

McCormick & Company is also interested in gaining further insight on the corporate valuation of the company, as they need to know how much capital theyll need to raise to construct the factory. To understand valuation, you must review dividends, options, warrants, derivatives, discount rate, and yield.

DIALOGUE WITH FRANK MARINARA

Frank tasks you with recommending a method for raising sufficient capital. McCormick & Company has been paying dividends to its shareholders for several years now, he says. The company has given us some data and would like us to recommend ways they can further leverage their financing activities. The company is interested in potentially issuing more stock or purchasing bonds to raise additional capital for the construction of the new factory. I will need you to answer a few questions about the companys stock prices and minimum acceptable rate of return. Your answers will help me make a recommendation to McCormick.

Working with the same Project 4 Excel Workbook you worked with in Step 1, complete the Valuation of Performance worksheet. This worksheet contains information on McCormicks dividends, stocks, and risk premiums, as well as questions that will guide the clients decisions.

When you have completed the Valuation of Performance worksheet, submit the Project 4 Excel Workbook to the folder located in the final step of this project. Next, proceed to Step 3, in which you will advise the client on selecting a retirement plan for its employees.