Corporate Finance Essay Examples

Monmouth, Inc. Questions 1. Is Robertson an attractive acquisition for Monmouth? (MON) 2. What is the maximum price that MON can afford to pay based on a discounted cash flow (DCF) valuation? What would be the maximum price per share? • Estimate the WACC • Credibility of the forecasts developed by Vincent and Rudd? • […]

Laura Martin says she gets “paid to talk” – to whom is she talking? Answer: Laura Martin is talking with investors. She would meet with many company representatives including the CEO, CFO, operating division chiefs and head of investor relations. She is in connections with these investors via telephone, fax, voice mail or email. It […]

British Airways (BA) and Easyjet are two British airline companies. They are competitors in many aspects with different operational techniques. Easyjet is Europe’s leading low-cost airline, which targets at both leisure and business markets on a range of European routes. It is one of Europe’s largest Internet retailers with ticketless travel service. In addition, it […]

Reference to Concept in Reading Definitions of Wealth Maximization Bernard Lester is CEO and founder of Lester Electronics the public Lester Electronics, Inc. which earns $500 million annually. In 1984, Bernard took his company public, and it is now traded on the NASDAQ market and rated Baa by a nationally recognized rating agency. A corporation […]

Laura Martin: Real Options and the Cable Industry Introduction Laura Martin, an equity research analyst for cable stocks, believes that the best way to value cable stocks is through creative methods such as real options and not through more traditional or typical valuation methods such as EBITDA multiples, ROIC analysis and DCF analysis. In 1999 […]

The Signal Cable Company, located in Tarrytown NY, is a cable manufacturer for analog and digital interconnects, speaker, video and home theater cables. The company is well known for “highest standard in quality and customer service” and their “superior design” and “No-Hype approach resulted in one of the best price/performance ratio in the industry” (www.signalcable. […]

The Netscape Communications Corporation conducted an IPO on August 9, 1995. During this event, they released 5 million shares at $28 per share. The trading day was exceptional as the newly issued shares witnessed a significant increase in value, rising up to $73 by mid-day and closing at $54. This marked a nearly 100% increase […]

Located in Munich, Germany, Deutsche Brauerei was a family-owned business that produced two outstanding types of beer, namely dark and light. The brewery was founded by Gustav Schweitzer in 1737 and had been passed down to generations of the Schweitzer family for a total of 12 generations. Although the members of the board possessed extensive […]

Executive Summary When one company (called the acquirer or bidder) acquires another company (called the target), then it is called takeover. Takeover can be of two types: Friendly Takeover and Hostile Takeover. In Friendly Takeover, the bidder informs the target of their takeover plans. If the target feels that the takeover will help its shareholders, […]

1. Why should a firm have a capital structure policy, i. e. a target debt ratio? A capital structure policy aims to balance the trade-off between the benefits of debt financing (interest tax shield) and the costs of debt financing (financial distress and agency costs). Every firm should set its target capital structure such that […]

How do CFOs make capital budgeting and capital structure decisions? John R. Graham Associate Professor of Finance, Fuqua School of Business, Duke University, Durham, NC 27708 USA Campbell R. Harvey Professor of Finance, Fuqua School of Business, Duke University, Durham, NC 27708 USA National Bureau of Economic Research, Cambridge, MA 02912 USA March 8, 2002 […]

Review the Balance sheet of the latest Walgreen Co. Ask Filing. Select two of the following questions to review/discuss: Which current assets are the most significant? Which non-current assets are the most significant?  Asset the level of debt and risk that Walgreen has by looking only at the balance sheet. Evaluate the creditworthiness of Walgreen […]

Tonight, though, Iris had more Important things to think about than comparative climatology. Through a combination of preparation, experience, hard work, and, she admitted, sheer luck, the 27-year;old Native American had received three Job offers. All were from buyout firms-?one a top-tier mega-fund, another a mid-market operation, and the last a firm looking to turn […]

To support management planning and decision-making, it is essential to analyze financial statements as a measure of business performance and recognize the effects of external interpretations. Lincoln Indicators provides nine golden rules for successful shareware investing, covering financial health, management assessment, outlook/forecast, share price value, sentiment, liquidity and size, principal activities, price-sensitive announcements. To evaluate […]

Financial flexibility refers to a firm’s ability to access financing at a low cost and exposed to unexpected changes in the firm’s cash flows or investment opportunities in a timely manner(Dense, 2011). A survey of Scoffs In Graham and Harvey (2001) suggests that financial flexibility Is the most Important determining factor of corporate capital structure […]

Publicly traded business also makes similar decisions on whether to return cash back to the owners (shareholders) and how much in the form of dividend. Lintier (1956) was the first empirical study on dividend policy, he revealed that dividend add value to the shares of a firm. The turning point in theoretical modeling of dividend […]

Introduction Blue Chip Blue chips are the biggest, most stable, and often the most reputable companies in existence. The term comes from casino houses, whihc use colored plastic chips to represent the money patrons gamble with. Traditionally, blue chips were the most valuable color chip of all; but in gambling today blue chips are among […]

The emergence of the financial derivatives market in India marks a significant milestone, as financial markets are naturally volatile, posing risk as a major concern for financial players. To manage such risk, derivatives were introduced – products that derive their value from one or more underlying variables referred to as bases. The use of derivatives […]

1. Define a business transaction in the broad sense, and give an example of observable external, observable internal and unobservable events. A business transaction is in the broad sense is the way in which business activities are analyzed to determine their financial statement effects. It is basically an exchange or event that has a direct […]

Nextel faced significant levels of bad credit from 2001-2002, which required major changes to remain profitable in the communications industry. To maintain the company’s health, Nextel deemed it necessary to improve their systems and policies. A tighter policy regarding credit card transactions was imposed by Nextel, requiring two identifiers when the credit card cannot be […]

Reporting and analyzing financial statements is a crucial aspect of any corporation or business. The accounting process serves this purpose to aid investors and lenders in making informed investment decisions based on a company’s current financial standing. An accountant’s responsibilities involve generating and evaluating financial records, such as cash flow statements, income statements, balance sheets […]

The long-term stability of Marks and Spencer can be evaluated by examining its gearing, which is the ratio of long-term debts to stockholders’ investments. The company’s gearing was calculated for 2007, 2006, 2005, 2004, and 2003. The data shows that the gearing value exceeded the typical rate of 1.0, indicating a preference for matching debts […]