industry and global economic situation on the valuation date as well as states the future trends. Bases for valuation consist of discounted cash flow valuation. Additionally the real option valuation method is used to determine the value of experimental medicine at the beginning of its development process. The results are compared to the usual discounted cash flow valuation method and give an answer if development of new medicine shall or shall not be proceeded with. 2 Acknowledgment I express sincere
Premium Balance sheet Cash flow Generally Accepted Accounting Principles
manager and consequently‚ Ms. Wilson has to produce a sound financial forecast for the company. PROBLEM DEFINITION In producing the financial forecast for NWC‚ Ms. Wilson has to determine the following: Additional funds needed (AFN) Free cash flow In relation to the above‚ Ms. Wilson has to consider effects on the following items: Operational capacity against sales projections Assumptions in receivables management Forecasted growth in fixed assets Expected improvement in inventory
Premium Generally Accepted Accounting Principles Balance sheet Free cash flow
4 Industry 5 Company 5 Investment thesis 5 Important value drivers 5 Risks‚ caveats‚ and exposures 6 VALUATION 7 Summary of important series 7 Selected growth rates 7 Components of weighted average cost of capital (WACC) 7 Free cash flows and economic profit 7 BIBLIOGRAPHY 9 SUMMARY As a student analyst for Drake University’s Krause Challenge Fund‚ I have conducted a financial analysis and valuation of Olin Corporation‚ a producer of Chlor Alkali products and Winchester ammunition
Premium Free cash flow Cash flow Inventory
taking” (Comcast). The compensation committee plays an important role in deciding compensation in terms of total compensation opportunity and the break-up of components of compensation. It also helps the board to recommends qualifying criteria and measures on which executives will be evaluated. Also some conclusion regarding the instrumentality of specific measures were reached. For example Comcast compensation committee concluded that operating cash flow had the highest overall meaningful correlation
Premium Dow Jones Industrial Average Cash flow Stock
Cash Flow: * Instead of contributing an inflow to the cash‚ the operating activity doesn’t generate a positive cash flow because they resulted a negative net income and increase in working capital * For expansion‚ the firm spent on fixed asset of total RM 711‚950 therefore it also borrowed huge amount of money and sold its short-term investment because it doesn’t have enough cash * There’s still a negative flow (outflow) of cash after summing up all the activities in the cash flow statement
Premium Generally Accepted Accounting Principles Balance sheet Inventory
consider the following questions: 1. Can you rank the projects simply by inspecting the cash flows? 2. What criteria might you use to rank the projects? Which quantitative ranking methods are better? Why? 3. What is the ranking you found by using quantitative methods? Does this ranking differ from the ranking obtained by simple inspection of the cash flows? 4. What kinds of real investment projects have cash flows similar to those in Exhibit 1? This case was prepared by Robert F. Bruner‚ with the permission
Premium Net present value Investment Free cash flow
Summary Financial Information FY 2000 in $ ’000s Sales 22500 EBITDA 2500 Depreciation 1100 Operating Profit 1400 Net Income 660 Terminal Value Growth 5.00% Initial outlay 1500 Additional Assumptions Risk free rate Proj. cost of debt Market Risk Premium Marginal Corporate Tax Rate Proj. Debt Beta Asset Beta for Kramer.com Expected Asset Return 5.00% 6.80% using CAPM 7.20% 40.00% 0.25 1.50 15.80% using CAPM Projections for Home Delivery Project 2002E 2003E 2004E 2005E 2006E Sales 1200 2400
Premium Generally Accepted Accounting Principles Cash flow Finance
Valuation models Discounted cash flow models: Dividend discount Free cash flow to the firm Residual income Multiples-based valuation: Price-earnings Value-EBITDA Value-EBIT Value-Sales Price-Book value Equity valuation In conjunction with the valuation of Coles Group‚ contained in “Excel03 Equity valuation” Real options valuation Equity markets price shares above the present value of expected future cash flows‚ due to the presence of embedded options not captured by DCF analysis Real
Premium Discounted cash flow Weighted average cost of capital Generally Accepted Accounting Principles
valuing the processing plant can easily be decomposed into three distinct steps first‚ find the value of the foreseeable free cash flows. Next‚ calculate the terminal value of the project. Finally‚ take the present value of those flows. The next few paragraphs walk through each of these steps in order of progression. In the first step we analyze the data and calculate the free cash flow from the inception of the project to the foreseeable future. We opted to use Exhibit 7‚ which incorporates an 11%
Premium Net present value Cash flow Free cash flow
were able to become partners with AOL and believed with this strategic move they would be able to dominate the online wedding market. In order to be a successful business model The Knot would have to generate revenues‚ make profits and produce free cash flows. They felt they could generate revenues based on the fact that there were 2.4 million wedding per year and advertising revenues were very high. Also based on financial projections by their investment banker team they were able
Premium Corporate finance Free cash flow Generally Accepted Accounting Principles