Analyze 5 Companies Which Are Come from Banking Sector, Media Sector, Telecommunications Services Sector, Consumer Durables Sector and Transportation Sector
Content
Approach I: “Dividend Discount Model” 3 (1) Dividend payout in 7 years 3 (2) Constant growth rate estimation 4 (3) Net earnings from same sector 11 (4) ROE for the companies in the same sample set 16 (5) Share price estimation by DDM 21
Approach II: “Valuation Multiple” 23 1) Price – earning ratio of each sector 23 2) Share price estimation by PE ratio 28
Reconciliation report 30
In this assignment, we are going to analyze 5 companies which are come from Banking Sector, Media Sector, Telecommunications Services Sector, Consumer Durables & Apparel Sector and Transportation Sector. The analyses include: • The last seven years’ dividend payout data of the five companies; • The estimation method used to compute the proxy value for the constant growth rate term; • Net earnings of all the companies from the same or a closely related sector in our sample sets; • The individual ROEs for the companies in the sample sets; • The calculation of average price-earnings ratio, earnings-per-share, expected earnings-per-share and estimated share price applying the “valuation multiple” approach for each of our chosen five companies; • Reconciliation report comparing & contrasting the theoretical share prices obtained using the two different approaches as well as the actual market price for each of our five chosen companies.
Approach I: “Dividend Discount Model”
(1) Dividend payout in 7 years
For banking sector, Australia and New Zealand Banking Group Limited (ANZ) was chosen.
|Dividend (in cents) |
|2004 |2005 |2006 |2007 |2008 |2009 |2010 |
(data from http://www.aspecthuntley.com.au.ezproxy-f.deakin.edu.au/af/company/dividendspay?ASXCode=ANZ&xtm-licensee=finanalysis Accessed on 13th August 2011)
For Media Sector, Austereo Group
Approach I: “Dividend Discount Model” 3 (1) Dividend payout in 7 years 3 (2) Constant growth rate estimation 4 (3) Net earnings from same sector 11 (4) ROE for the companies in the same sample set 16 (5) Share price estimation by DDM 21
Approach II: “Valuation Multiple” 23 1) Price – earning ratio of each sector 23 2) Share price estimation by PE ratio 28
Reconciliation report 30
In this assignment, we are going to analyze 5 companies which are come from Banking Sector, Media Sector, Telecommunications Services Sector, Consumer Durables & Apparel Sector and Transportation Sector. The analyses include: • The last seven years’ dividend payout data of the five companies; • The estimation method used to compute the proxy value for the constant growth rate term; • Net earnings of all the companies from the same or a closely related sector in our sample sets; • The individual ROEs for the companies in the sample sets; • The calculation of average price-earnings ratio, earnings-per-share, expected earnings-per-share and estimated share price applying the “valuation multiple” approach for each of our chosen five companies; • Reconciliation report comparing & contrasting the theoretical share prices obtained using the two different approaches as well as the actual market price for each of our five chosen companies.
Approach I: “Dividend Discount Model”
(1) Dividend payout in 7 years
For banking sector, Australia and New Zealand Banking Group Limited (ANZ) was chosen.
|Dividend (in cents) |
|2004 |2005 |2006 |2007 |2008 |2009 |2010 |
(data from http://www.aspecthuntley.com.au.ezproxy-f.deakin.edu.au/af/company/dividendspay?ASXCode=ANZ&xtm-licensee=finanalysis Accessed on 13th August 2011)
For Media Sector, Austereo Group