To: Dr. Lynna Martinez Subject: Calaveras Vineyards Valuation As per your request‚ my associates and I have calculated a valuation for Calaveras Vineyards using the present value of cash flows. We used the valuation of future cash flows method in order to value to value the company. We have come to the conclusion‚ based on a number of future projections‚ that the best valuation of the vineyards is $4‚356‚000 in assets and $1‚104‚000 in equity. The process at determining this valuation was as
Premium Discounted cash flow Free cash flow Cash flow
project free cash flows as opposed to the accounting profits earned by the project when analyzing whether to undertake the project? Free cash flow is one of the most important factors when looking at any new business or starting a new product. When calculating free cash flow‚ the business owner or management will able to have an idea about the cash that the company is generating enough cash to start new product or expand its business. Caledonia should focus on project free cash flows as opposed
Premium Free cash flow Cash flow Generally Accepted Accounting Principles
THIS IS A LIST OF EXCEL PROGRAMS THAT YOU MIGHT FIND USEFUL. THEY ARE NOT COPY PROTECTED. FEEL FREE TO MODIFY THEM TO YOUR OWN NEEDS. Corporate Finance Spreadsheets 1. capbudg.xls: This program allows you to do a basic capital budgeting analysis for a project‚ and compute NPV‚ IRR and ROI. (For Macintosh version) 2. risk.xls: This program allows you to use past returns on a stock and a market index to analyse its price performance (Jensen’s Alpha)‚ its sensitivity to market movements
Premium Discounted cash flow Cash flow Corporate finance
HANSSON PRIVATE LABEL Objectives: • • • • • Define and derive debt free cash flows Critically analyze the assumptions underlying financial projections Role of opportunity cost of capital in capital budgeting decisions. Calculate NPV and its sensitivity to project variables Alternative methods of project evaluation Overview of Hansson Private Label (HPL): • • • Given the comparable company information‚ HPL ranks mid-pack in terms of revenue. Christine Sinclair and Skin Care Enterprises are more
Premium Net present value Generally Accepted Accounting Principles Corporate finance
a terminal value? What other types of terminal values might be appropriate (i.e.‚ other than smooth growth procedures)? Ch. 9 Exercise #2 A-D The TecOne Corporation is about to begin producing and selling its prototype product. Annual cash flows for the next five years are forecasted as: ------------------------------------------------- Year Cashflow 1 -$50‚000 2 -$20‚000 3 $100‚000 4 $400‚000 5
Premium Corporate finance Net present value Internal rate of return
and procedures used by clients and the accounting policies and procedures that should be followed. The audit memorandum also provides a clear explanation of a difference between the risk premium in discounting the free cash flow from Plant 3 and the risk premium in discounting the cash flows for the Macinaw Division and which of the appropriate discount rate for computation of goodwill impairment. The case mentioned about impairments which will be written down after the assets are tested for impairments
Premium Generally Accepted Accounting Principles Goodwill Depreciation
Mercury Footwear Questions 1. Is Mercury an appropriate target for AGI? Why or why not? Yes‚ we do think so. In the case‚ we could find some characteristics of footwear industry: (1) It is a mature‚ highly competitive industry marked by low growth‚ but stable profit margin. (2) Performance of individual firms could be quite volatile for they need to anticipate and exploit fashion trend. (3) Except some global footwear brands‚ athletic and casual shoes market is still fragmented‚ which
Premium Net present value Free cash flow Cash flow
the valuation method that better matches its insights into specific drivers creating value in the industry (Lie and Lie‚ 2002). Jointly‚ Young‚ M 1996). According to Oded‚ J. (2007)‚ there are four cash-flow methods to value a company: Adjusted Present Value (APV)‚ Capital Cash Flows (CCF)‚ Cash Flows to
Premium Discounted cash flow Weighted average cost of capital Free cash flow
Full Year Results Year ended 31 December 2012 28 February 2013 Cautionary statement This Review is intended to focus on matters which are relevant to the interests of shareholders in the Company. The purpose of the Review is to assist shareholders in assessing the strategies adopted and performance delivered by the Company and the potential for those strategies to succeed. It should not be relied upon by any other party or for any other purpose. Forward looking statements are made in good
Premium Free cash flow Business terms Cash flow
spreadsheet we can calculate Beta for comparable companies. I calculate the Beta for Ben & Jerry’s to be 1.5994. I calculate Beta for Dreyer’s to be 1.2524. This averages out to 1.4259‚ which is the Beta I estimate for Eskimo Pie. Using the risk free rate of 4.56% from Exhibit 9‚ and an expected market return of 13.99% ‚ I calculate the expected return on equity to be 17.9968%. Thus‚ calculating the Weighted Average Cost of Capital: (.0367588)(11.44%) + (.9632411)(17.9968%) = 17.7558%. The
Premium Free cash flow Generally Accepted Accounting Principles Cash flow