WEEK 7: RESTAURANT INDUSTRY Q1. What do you expect to drive a company’s price-to-book equity and price-to-earnings equity? Price-to-book multiples are a function of future abnormal ROEs‚ book value growth and the organisation’s cost of equity * Future abnormal ROE: ROE less the cost of equity capital (ROE – re). Organisations with positive abnormal ROE are able to invest their net assets to create value for shareholders and have price-to-book ratios greater than one. * Organisations’
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Saudi Cement Company…………….…………………………... 6 4. Company Valuation ……………………………………………………………... 7-11 4.1. The Free Cash Flow Model (FCF) ………………………………………... 7 4.2. The Dividend Discount Model (DDM) …………………………………… 8 4.3. The Discounted Cash Flow Model (DCF) ………………………………... 8-9 4.4. Key Indicators ……………………………………………………………... 9-10 4.5. Peer Comparison …………………………………………………………... 10-11 5. Conclusion ………………………………………………………………………. 12 6. References ………………………………………………………………………
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Financial Management Assignment - A Question 1a: Should the titles of controller and treasurer be adopted under Indian context? Would you like to modify their functions in view of the company practice in India? Justify your opinion? Answer to 1a: Controller & Treasurer are independent & they have their own Perspectives & Drivers as detailed below: Controller Responsibilities include‚ Double entry accounting‚ financial reporting‚ Fraud measure‚ detective controls‚ Financial restatement‚ Compliance
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Capital Asset Pricing (CAPM) or Discounted Cash Flows (DCFM) Model. The organization will have to compare and contrast the Capital Asset Pricing Model with the Discounted Cash Flows Model. The skill of comparing and contrasting financial options will help evaluate and organize the debt/equity mix and dividend policy. The organization must then decide what type of long-term finance alternatives will most likely benefit. Capital Asset Pricing Model and the Discounted Cash Flows Model
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before Change: P0 = D1 /(R+g) Use it to find future P P1 = D2 /(R+gnew) Bond Repayment = total bond*(face value + last payment price) Efficient Market -Stock prices fully reflect available information -Competition among investors eliminates abnormal profit Foundation of ME Rationality: adjust their estimate of stock prices in a rational way Independent deviation from rationality: # optimist = perssimistic Arbitrage: 0 investment‚ no risk‚ but + reward Different Type of Efficiency Weak:
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instantaneously (or promptly) and accurately so that no one is able to use information that is already known by the market to earn abnormal returns net of transaction costs and should not deviate from its fundamental true & fair price for a long period of time. • By abnormal‚ it means the return net of transaction costs is more than justified by its level of risk. Abnormal profit cannot earned from trading based on information already known to the market. • Since information arrives at the market at
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75 Sell $3.10 Strong Sell $1.70 competition‚ a decline in consumer sentiment and poor economic conditions. In addition‚ the expiry of the contract with American Express credit cards in FY14 is forecasted to cause a severe fall to its earnings. Consequently‚ David Jones would have to prepare for the difficult conditions ahead by focusing on cost-cutting and investing capital in alternative shopping channel such as the web-store. The financial analysis reveals that David Jones has marginally
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JetBlue Airways IPO Valuation Background Started in 1999 with the promise to “bring humanity to air travel‚” JetBlue entered the “Discount Fare Airlines” to join the likes of Southwest‚ ATA‚ Frontier and others (Bruner 2002). With a strong and experienced management team‚ having Continental Airlines’ former vice-president as president and COO‚ and Southwest Airlines’ former executive vice-president and treasurer as CFO‚ David Neeleman believed that his new airline would thrive. Neeleman built
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Financial Report Analysis for David Jones Ltd Table of contents 0.0 Introduction ------------------------------------------------------- 1 1.0 Strategy Analysis ------------------------------------------------------ 1 2.0 Accounting Analysis --------------------------------------------------------- 4 3.0 Financial Analysis --------------------------------------------------------- 9 4.0 Prospective Analysis --------------------------------------------------------
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EPPM3644 KEWANGAN KORPORAT DAN PENSTRUKTURAN SET: 3 REPORT OF CASE STUDY: CASE 19 WORLDWIDE PAPER COMPANY PROFESSOR: DR. LIZA MARWATI BINTI MOHD YUSOFF GROUP MEMBERS: LOH CHAI LING A140178 GOH HOOI SAN A139708 KERK (KEH) YIH JEN A139574 SEMESTER 2‚ 2013/2014 INTRODUCTION In December 2006‚ Bob Prescott‚ the controller for the Blue Ridge Mill‚ was considering the addition of a new on-site longwood woodyard. Two primary benefits for this new addition include eliminating
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