Essays on Dividend

Company Overview

Apple manufactures designs, and markets communication mobiles as well as media devices, portable digital players and personal computers in addition to making sales of the related software, accessories, services, network solutions as well as digital third-party content and applications. The management of the company`s business primarily is on the basis of geographic region including the Europe, America, Japan, Greater China, Rest of the Asia-Pacific as well as Retail. The Company has a commitment to bring the best customers experience onto its customers via its innovative software, hardware as well as services. It leverages its unique ability in designing ...

About the paper

The paper is commissioned to discuss the dividend policy of German car manufacturer, Volkswagen and analyze whether the past three year dividend payments is in accordance to the dividend policy of the company. As part of this paper, we will also calculate the weighted average cost of capital(WACC) of the company.

About the company

Founded in the year 1946, Volkswagen AG is a german car manufacturer and at present is the second largest automobile manufacturer in the world. The company, together with its subsidiaries, manufactures and sells automobiles in Europe, Americas and Asia-Pacific. In addition to automobile manufacturing, the company has ...

Part 2

The return will be computed using the yield to maturity formula. YTM captures all the relevant information in the valuation. 1)

Corporate bond

YTM = C+(F-P)/n(F+P/2 C is the coupon payment = 10.125% *1000 = 101.25 F is the face value = 1,000 P is the price = 879.625 N is the periods to maturity = 25 YTM = 101.25+(1,000-879.625)/25(1000+879.625)/2 = 11.6%

Government Bond

YTM = C+(F-P)/n(F+P/2 C is the coupon payment = 6.825% *1000 = 68.25 F is the face value = 1,000 P is the price = 975.42 N is the periods to maturity = 25 YTM = 68.25+(1, ...

<Your Professor’s Name> <Course Name & Code>

Company history, Economy and Competition What is the recent history of the company? Apple Inc. is a multi-national company founded by Steve Jobs and Steve Wozniak in 1976 in California, USA. Jobs and Wozniak were high school friends who dropped out of college together to venture into the computer technology industry in 1976. The company started off with the launch of a simple Apple I computer in 1976 but has now gained enough momentum to be labeled as the most admired company and valuable brand in the world. The Company ...

DQ 6x

Q1: The principal considerations of a board of directors in making decisions involving dividend declarations There are three principal considerations of a board of directors in making decisions involving dividend declarations: the dividend policy; the type of dividend; and the source of dividend. Dividend policy: The Board must decide between two main policies in dividend declaration: progressive policy and payout ratio policy. Progressive policy may be in any of the three common methods: (1) increase or at least sustained; (2) increasing steadily (at a defined rate); and (3) increasing in real value (Financial Reporting Council [FRC], 2015). Conversely, payout ...

I choose to Invest in Apple Inc., Wal-Mart Stores Inc., and Yahoo! Inc. The Ticker Symbols for Apple Inc., Wal-Mart Stores Inc., and Yahoo! Inc. are AAPL, WMT, and YHOO respectively. As of January 22, 2016 for AAPL stock price rose by 5.12% to close at $101.42, WMT rose by 1.31% to close at $62.69, while YHOO rose by 1.50% to close at $29.70 (Morning Star). I decided to purchase 100 shares of each company bringing my total investment to $19,386 ($101.42 x 100+ $62.69 x100 +$29.75 x 100. I choose Apple Inc. because I love their products ...

About the paper

The paper is commissioned to discuss the short-term debt scenario, foreign exchange risk management process and trends in the financial ratios of Arrow Electronics Limited. In order to achieve a desired outcome in the paper, we will comprehensively analyze the financial statements and accompanying notes provided in the latest annual report of the company, so released on 5th February, 2015.

Advantages and Disadvantages of sources of short-term finance

i) Bank Loans

Advantages:

No dilution of ownership Tax advantages because of interest deductibility No interference in managerial decisions Option to opt for fixed or adjustable interest rate loans Disadvantages: High cost of debt Obligation to pay timely interest and ...

The objective with which the report is being prepared is the financial analysis of the books of accounts and the ratios of Specialty Fashion Group, which has been listed in the Stock Exchange as a fashion house in Australia. The attempt made will be examination of necessary ratios that explain all kinds of profitability, efficiency, long term solvency, short-term solvency and the returns on shareholder’s investments (Accountingedu.org, 2016). A comparative analysis is to be made between ratios of different years to understand the rising trends and to track performance indicators. The conclusion should then bring out whether there ...

Introduction

Analysis of Nike’s dividend over three years period Nike has been paying dividends to its shareholders every year based on its level of earnings. The three years analysis of Nike’s dividend distribution has been shown in the table below. Nike's dividend per share and earnings per share has increased which also indicates that revenue and profit of the company had increased over that period. (Gibson, 2008) The trend of the past three years projected that the company has improved its market position and was able to provide enough dividend to its shareholders for their investment in the ...

Executive summary

The report is meant to select and analyse stocks to invest in among the FTSE 100 companies. This involves analysing the expected performance of the stock exchange and FTSE 100 companies for the next five years and the influence of the general economy on such. It analyses the past performance of three companies in different industries and predict their performances in the next five years. The report also applies the concepts of portfolio theory, diversification and risk-return trade-off to create a portfolio. Analysis of economic factors indicates that the LSE will experience growth in the next five years. The ...

Company description

Dunkin Brands Group is a Delaware corporation dealing in the business of ice creams, baked goods, bagels, muffins, breakfast sandwiches, and hot and cold coffee, among other products. It franchises quick service restaurants all over the world. The company was founded in 1989 when Allied Domeeq Quick Service Restaurants acquired Baskin Robbins and Dunkin Donuts and organized the two firms under one name, Dunkin Brands Group, Inc. (Dunkinbrands.com, 2015). The company operated more than 18,800 distribution points in about 60 countries as at December 27, 2014 (Dunkinbrands.com, 2015). The company operates through its four segments; Dunkin Donuts-US, Baskin ...

Dividend theories do not offer any support to the issue of dividends. Some authors consider that the ability of paying dividends is connected with financial performance of a company; others argue that the information about dividends is irrelevant. Below several points of view are examined. Aharony and Swary (1980) consider that dividends provide ambiguous information in comparison to earnings because they are almost at management’s discretion solely. Also, they stated that empirical assessment of the amount of dividends and earning is difficult because these two numbers are closely synchronized. Thus, these two signalling devices (dividends and earnings) do ...

Introduction:

The analysis was conducted so as to study the behavior of two stocks i.e Commonwealth Bank of Australia and ABM resources. We began our analysis using various financial and government websites. For Instance, the risk free rate was derived from RBA, Australia using 30 Day Bank Accepted Bill as a proxy. On the other hand, all the stock related and market index(S&P 500-APX 200)information was derived from Yahoo Finance. We concluded the report by conducting a regression analysis between the excess return of each stock over risk free rate and excess return of market index over risk free rate

Stocks Analyzed

...

Income Statement:

Balance Sheet: Cash Flow Statement: Statement of owner’s equity: Risk and Return Scenario:

As of the year 2014, the company is expected to be in good profit numbers. The company is one of the biggest chemical manufacturers in the world and operates on string business models and strategies. Over the years, the company has shown significant growth in profit figures and the same is reflected in its stock price appreciation and dividend payouts. Some of the favorable return strategies of the company include:

- Driving innovations in its products so as to address ...

The book Creating a World without Poverty: Social Business and the Future of Capitalism by Muhammad Yunus is about the social business, which aims to help poor people improve their living. Primarily, its objective is to meet a social goal. The idea of social business is a business that pays no dividend. The business’ products are sold at prices that enable the company to thrive. The owners of the company can regain the amount they have invested over time, but the investors will not receive any profits or dividends. The profit made stays in the business for expansion, to develop new services ...

Debt Structure of Intel

Intel is one of the largest companies supplying computer chips, semiconductors and peripherals to the computing industry. It is also a very well managed organization both operationally and financially. This activity will discuss the capital position of the company and its capital structure. The glance at the ratios in the table below tells us about the capital structure condition of the company.

The above table clearly shows that the company is more geared as compared to the industry average. In other words, the company has more debt as compared to the industry. This also means that the company will ...

- P/E Ratio stands for Price-Earnings Ratio. The variables that affect P/E ratio are market price of a share. Market price of the share is what it is trading at the stock exchange. The second variable that affects the P/E ratio is the Earning Per Share. Earnings per share are calculated by dividing the Net Profit after Interest and Taxes divided by the number of shares outstanding. All of these calculations reveal how much the firm is valued in terms of stock valulation.

- Stock valuation uses the time value of money in the calculation. There are several concepts ...

Executive Summary

The report discusses various aspects relating to Air New Zealand Limited and The Warehouse Group where the objective is to issue a recommendation to the investors as which stock might offer better return to them. The report begins with a succinct discussion about both the companies which is then followed by assessment of their financial trend using their latest issued annual report and past three year stock price movement.

The next section deals solely with the financial aspects where we unearthed the capital structure of the companies, required rate of return, calculated their free cash flows and ascertained their intrinsic ...

Introduction

Company valuation is an essential area when it comes to determining the value of an organization or business. Such information helps a company to plan its future investments. Additionally, potential investors can rely on company valuation information to determine whether it will be beneficial to invest in a company. This paper seeks to look into a number of company valuation techniques based on the Royal Dutch Shell Company. Furthermore, it provides information on how the efficient market hypothesis affects price movements with reference to Royal Dutch Shell Company. The stock market is especially advantageous because of the liquidity of the securities ...

- The difference between common and preferred stock

Common stock, also called ordinary stock, are part of equity stock, which earn variable dividends. The amount of dividend they receive depends on the company’s performance and the decision of the board of directors. Thus, the dividend varies from annually and in some years, they may not receive dividends. Furthermore, common stock has residual claim on dividends after preferred stock have been paid. Common stock have an ownership stake in the company, accompanied by voting rights either in person or by proxy. They can, therefore, participate in some aspects of decision-making such as board membership, stock splits or ...

Background:

With a rich history of success, Pepsi was an establishment of the 1898, in Carolinas. The drink was an original invention of Caleb Bradham. Based in New Bern, North Carolina, he was a pharmacist and drugstore owner ("Pepsi History," n.d.).

It was five years after the introduction of Coke that Pepsi came into existence, in the year 1893. This was the time when the inventor Caleb Bradham decided serving customers his soda machine produced ‘Brad’s Drink’. In response to the positive feedback that he received from the drinkers, he began advertising his samples in 1898, after naming ...

(a) How much did your company’s gross margin and gross margin as a percentage of revenue increase (decrease) over the past five fiscal years?

As per the report of Stock Analysis on Net on Starbucks’ profitability analysis, Starbucks’ gross profit margin was 55.75% in 2009, and it notably increased to 58.36% in the following year. However, the firm’s gross profit margin was decreased by 0.66% in 2011 reaching 57.70%. It was again dropped to 56.29% in 2012. According to the same report, in the last fiscal year, Starbucks achieved an improved gross profit margin of 57.14%. The recent increase in the company’s gross profit margin indicates that Starbucks is recovering from the shocks of the recent global recession. Similarly, the organization’ ...

Coca Cola and Pepsi are two brands which are well known and most demanding brands among soft drink brands. There has been tough competition between these two brands which look like similar, taste like similar, but still they are different. Coca cola was introduced in 1950 while Pepsi developed much later as the company faced bankruptcy in 1920. The two brands are similar in tastes and appearance, but Pepsi is sweeter than Coca Cola. But people also claim that taste of Coca Cola is better than Pepsi. Other found Pepsi more affordable than Coca Cola.

Coca Cola is most ...

Introduction

British Telecom and Vodafone are two giants in the telecom industry. After the financial burst of 2008 in the US Economy and the financial troubles in Europe, the telecom sector got badly impacted. In fact the whole sector instead of growing has slid into a negative growth which has affected almost all the telecom companies. British Telecom and Vodafone are trying to diversify their portfolios by making efforts to come up with innovative product packages to fuel growth. So far the initiatives have not shown much improvement in the results. In such conditions it is becoming very difficult for those ...

- What is the purpose of Tune Ins Holdings Berhad’s IPO?

On 23 September 2013, Tune Ins Holdings Berhad (TIHB), an insurance products provider, announced a press release regarding the prospectus for its Initial Public Offering (IPO). TIHB announced it’s listing on the Main Market of Bursa Malaysia Securities Berhad (Bursa Securities). Under this IPO, TIHB will sell up to 210,224,900 ordinary shares to Malaysian and some particular influential investors, including Bumiputera investors approved by the Ministry of Finance (Tune Insurance). As per to the prospectus in the press release, earnings of the IPO procedure will ...

In the present era of Corporate Modernization, unlike the traditional activities, it is not the owners which runs the company, infact they hire competent management to work on their behalf. Moreover, every owner(shareholder) consider that the managers so appointed to work on their behalf will act in the best interest of their owners and will assure shareholder’s wealth maximization. Infact, in present complex corporate era, the performance of the company depends upon, how competent the management is adapting the dynamic business environment and related circumstances. Thus, the ability to properly adapt and implement the changes in the ...

Until 2011, AiraAsia did not have any dividend policy. However, AirAsia paid their maiden dividend in the year 2011 of 3 sen for every ordinary share for rewarding their loyal shareholders. This was due to the reason that their business was in its early stages of capital and development and needed the revenue reinvested for its future well being (Airasia, 2011). The company used no dividend policy due to their need of funds for the company’s growth and their working capital requirement (Management Education, 2012). The Directors at Airasia wished to announce that their Company adopted the dividend ...

Answer 1

Common stock has several issue characteristics. The first is that it represents ownership in a company. The second characteristic is that it has voting rights for the holders. Thirdly, this stock has volatility for its holders. Another characteristic is that the holders of these shares have the right for receiving dividends as determined by the management board of the company. This stock has a number of advantages. The first is that it has the potential to deliver high gains as due to dividends and capital gains. The other advantage is that the potential loss from an investment in stocks is limited ...

QUESTION 1:

INTRODUCTION: Pet.com is an e-business, founded by two graduates and Ms. Solberg, with a total equity capital of $1.5 million. Despite greater losses the company has tolerated, investors are eager to invest in the shares. Seeing the excitement, company decided to go public with the sale of 500,000 shares in initial public offering by the three existing shareholders, along with the sale of additional 750,000 shares by the company so as to provide funds for expansion. Further, the underwriters suggested placing price at $18 a share instead of $24, but financial manager was worried about the fact that ...

Introduction

Every decision established in the company has a decision that involves the use of funds this is referred to as a financial decision. In the process of making financial decisions, the conventional corporate finance theory assumes that the main objective is to optimize the value of the company, which is referred to as maximizing shareholder wealth. Since the key objective in the corporate finance is to optimize company value, any financial decision that increases this value should be regarded good, while that reduces value is deemed poor. Therefore, the value of the company is determined based on three main financial decisions ...

Sources of Financing and Dividend Policy

Although each of the stated proposals has its own benefits and drawbacks, Echo Co should choose one that would be the most beneficial for the Company and its finances. In this paper we perform the analysis of each of the stated proposals and give recommendation on the most appropriate option for Echo Co.

Proposal A

Dividends are defined as a distribution of a part of company’s earnings to its existing shareholders (Brealey, 2009). There are several dividend theories in corporate finance which have different approach to benefits and disadvantages of dividends. According to the studies of Gordon (1963) and Lintner ( ...

Introduction

At the heart of every successful corporative is the financing decisions that it adopts to ensure its financial stability. While companies are aiming at maximizing profits, the level of financial risk that they face ought to be minimized. This is usually achieved by making sure that the capital structure of the firm is optimal. In this regard, the dividend policies and decisions of a firm constitute the integral part of firm’s strategic financing decisions as it determines the division of earnings between shareholders and re-investment into the firm. The managers therefore have to formulate an optimal dividend policy that ...

Introduction

At the heart of every successful corporative is the financing decisions that it adopts to ensure its financial stability. While companies are aiming at maximizing profits, the level of financial risk that they face ought to be minimized. This is usually achieved by making sure that the capital structure of the firm is optimal. In this regard, the dividend policies and decisions of a firm constitute the integral part of firm’s strategic financing decisions as it determines the division of earnings between shareholders and re-investment into the firm. The managers therefore have to formulate an optimal dividend policy that ...

Weighted average cost of capital (WACC) is the minimum return expected from the securities of a company. It is the sum of the weighted costs of the individual components in the capital structure. The product of the cost of capital of a component and the proportion of the component in the capital structure yields the weighted cost of that particular component in the capital structure. The cost of capital for equity is the ratio of the dividend per share and the market price for each share. This is computed as 1.50/15*100=10%. The weighted cost of equity capital is the product ...

Executive summary

Royal Dutch Shell PLC commonly known as the shell is second largest energy company in the world whose registered office is in London. It is oil and Gas Company operating in various parts of the world; to stay relevant to climatic and environmental changes it engages in both renewable and non renewable energy. In addition, it is a vertically integrated oil company which engages in all oil activities from exploration to refining and marketing. Apart from its core activities, it has entered into partnership with various international organizations to preserve the environment. The company shares are listed in London stock ...

Valuation

Introduction One credible website that investors can use to find the present value of stocks and latest news about bonds being traded is www.nasdaq.com.

Valuation and Time Value of Money

Money has worth associated with time. A dollar today is worth more than a dollar in coming year. This is the foundation for the concept of time value of money. In order to make financial decisions, the concept of time vale of money is very essential. The concept of time value of money has many uses, starting from creating schedules for disbursing off loans to judgements about purchasing new assets. Hence in finance, no concept ...

Introduction

Background of British Airways British Airways (BA) was formed in 1972. The initial approach of the company was to manage two national airline companies named “British Overseas Airways Corporations” and “British European Airways”. BA is an international airline that is headquartered in London. The company is providing its services in above 400 destinations in different parts of the world. The company creates alliances with code share, franchises and other joint ventures. The vision of the company is to become the most accepted airline in the world. To accomplish their vision British Airways always tries to control its ...

Owner’s Equity

As an investor, is paid-in capital or earned capital more important? Explain why. According to viewpoint from accounting, the money invested by the owner of the company is company’s equity and is made up of different parts, some being coming from the money owners directly and some coming from the profits of the company. The need of financing fulfilled from the issuance of the share which is paid in by investor as common or preferred stock is the paid in capital. It also may be referred as contributed capital. On the other hand, additional paid-in capital ...

Introduction

Capital structure management is a crucial aspect of effective cost control. That is because the structure determines a company’s cost, hence determining its performance and ability to create wealth for its shareholders. In that view, this analysis seeks to demonstrate how the structures influence companies’ performance as well as decision making. To achieve that, the analysis evaluates three companies in Hospitality industry. In that respect, this report begins with an overview of the companies’ debt structure and how it influences the companies’ cost of capital. That is followed by overview of how the companies’ long term financing polices as well ...

Betting for the future is important in securing a better life. Prudent investment in stocks can be a significant source of benefits (Chan, Chia-Ying, et al. 162). The value foe cash is determined on how careful one invests his or her cash today. According to Lyons and Savage (21), investing in stock implies that one owns part of the company and benefits that are in terms of dividends. Despite earning of the dividends at the designated periods, one contains to be part of the company as long as there is ownership of shares. There are seven major steps that should govern a ...

1. How would you characterize competition in the gaming industry in Macau? Macau is one of the biggest gambling hubs in the world and is especially attractive because it is the only place in China where gambling is legal. Many companies wish to open casinos or hotels in this former Portuguese colony. However, with casinos it is not that simple. Legally, there is no competition in the Macau gambling industry as the Executive of Macau SAR has a monopoly over all gaming business (Pereiro, 2010). It can sign concession agreements with companies granting them the right to open ...

Answer 1)

Considering the current financially bearish trend in Pan Europa, the entity needs to work on multiple yet chain corporate activities to avoid hostile takeover. Below are some strategies, which can be used by the company: i) To begin with, the company must channelize its investment in those projects that will assist the growth in the revenue figures and net income. It is also important for the company not take any additional debt and accept projects within their capital budget as the banks have already signaled red warning for unsustainable debt-equity position of the company with a rejection to grant any ...

The term registration is defined as the process, by which the company files required documents at SEC with the details of the particulars of anticipated public offering ("Registered company Definition - NASDAQ.com," n.d.). On contrast to that, holding companies, which do not sell the shares to the public, do not require to register with SEC. However, the SCE requires a common holding company to register under the Investment Company Act 1940 The main difference between registered and unregistered holding company are the SEC agreement regulations according to which the registered company must work.

We are dealing with these registered companies as the firm whose objectives are discussed below.

Now, any registered public company ...

Introduction

General Motors, popularly known as GM, is one the largest automobile companies in the world. Founded in 1908 in Flint, Michigan, the company is currently headquartered in Detroit, Michigan. GM occupied the number one position in the automobile industry for 77 consecutive years from 1931 to 2007 ("General Motors Company and Subsidiaries" 2015). Currently, it is the 3rd largest automaker in the world. In 2009, due to operational inefficiencies, slowness in the automobile market in the USA and huge overhead costs, GM filed bankruptcy. However, it restored its operation within a year and came back to profitability within 2 years. ...

1) Introduction The report is commissioned to evaluate the investment potential of leading American courier service company, FedEx Corporation. As part of this report, we will be discussing the trends in the financial statements of the company, which will be followed by a comprehensive ratio analysis section where we will be putting the financial figures of past two years under the microscope of financial ratios. In order to widen the scope of our analysis, we will also compare the trends in the financial ratios with that of two leading competitors of the company, United Parcel Services (UPS) and Deutsche ...

Financial ratios are crucial in evaluating a business’ performance over time and in comparison with industry peers. That is because the ratios provide an overview of performance for various business aspects ranging including profitability and market valuation. With that respect, the following is an overview of Wall-Mart’s performance regarding profitability and market ratios. The analysis entails P/E, ROE, and D/E ratios calculation and interpretation.

Company Description

Wal-Mart Inc. is an organization operating a retail stores business through various formats across the globe. Its operations are in three segments including Wal-Mart International, Sam’s Club and the Wal-Mart U.S.

Ratios Analysis

P/E The ratio ...

Introduction

Financial performance analysis is crucial for various stakeholders given the varying needs for performance information on various business aspects. In that respect, effective analysis entails evaluating performance over a period or comparing a company’s performance with industry peers. It also entails evaluating various performance areas using varying tools including financial ratios. In that view, the following is a report on Wyndham Worldwide Co. financial performance identifying the performance trend for the period beginning 2012 to 2014 and comparing its 2014 performance with that of the industry peers.

Analysis

Company Overview Organization and history Wyndham Worldwide Co. is a brand offering hospitality ...

Introduction

The decisions that the management makes regarding capital investment and financial management determines the success of any corporation. In essence, the management should make the investment, financing, and dividend decisions carefully to facilitate the maximization of the shareholders’ wealth. Ideally, sound investment decisions ensure that the firm utilizes the existing investment opportunities well. Additionally, sound financing decisions make sure that the firm has necessary sources of fund to use in its investments. What is more, sound dividend decisions ensure that the company retains enough earnings to distribute to the shareholders or use in future investments. The decisions about the ...

P/E ratio is the ratio of the market price of the stock and the earnings per share. P/E ratio has been a very important parameter to decide whether or not the stock is overvalued or undervalued in the market. Historical data shows that the Pfizer company’s price-earnings ratio was 15.09 in 2014, and it is estimated to be 16.72 in 2015. P/E ratio = Market price per share/EPS If we want to know whether the stock of Pfizer is overvalued or undervalued, we can calculate the intrinsic price of the share. The highest EPS forecast for the Pfizer ...

This case aims at establishing whether the directors of Snowzone Pty Ltd have breached their duties. The first thing to note is that an impeding conflict has ensued between James and the current directors as they try to impose company laws that he sees as oppressive and misplaced. The UK law provides for the occasion where a company can present an injunction to a director who has breached his responsibilities. On top of that, in a case such as the one that is presented, rescinding a contract may be a resort if it is established beyond reasonable doubt that the director(s) have a vested ...

Introduction

Stockholders are individuals who own shares in a public or private company. In most circumstances, the shareholders are the legal owners of the limited companies. There exist common and preferred stockholders. Common stockholders partially own the company and have the voting rights on issues affecting the company. Preferred stockholders also partially own the corporation although they lack voting rights on issues affecting the company.

Rights of common stockholders

Right to share company assets-common stockholders have an equal share of the company profits based on per share basis. The common stockholders are the main claimants of the income and the assets of the corporation. ...

Introduction 1

Company Background 1 Discussion Questions 2 1. The Various External Sources of Finance Available to the Company 2 a. Issuance of Common Shares 2 b. Corporate Bonds and Preferred Shares 3 c. Bank Loans 3 2. The Possible Considerations that may have been taken into account by the management when choosing the type of finance. All the relevant considerations explained and placed clearly in the context of the particular circumstances of the chosen quoted company. 4 3. The calculation of the Weighted Average Cost of Capital (WACC) appears to be straightforward in ...

Analysis of 10k of Dish Network and Direct TV

Executive Summary Organizations have to work extremely hard to maintain their effectiveness in the market as it is something which induces them to work hard for the economic prosperity. Every company that worked under a specific industry always try to maximize its financial belongings and shareholder’s wealth, but is really important for them to mitigate the issues relating to it which certainly leads to higher economic prosperity. Financial based competitiveness could be extremely important for the sake of an organization in particular. The main perspective of this assignment is to analyze the financial power of two different ...

Introduction to finance and quantitative methods

Question one - Ways of classifying financial markets Financial markets refer to markets where exchanges of financial instruments take place. Financial markets can be categorized in the following ways: - Nature of the products: Financial markets can be classified based on products ownership, the duration it takes to mature, how it is traded, size and how it can be transferred. Examples of such financial markets are equity and derivatives. - Market participants: Market participants may be made up of professionals, non-professionals or officials of an institution. Under this criterion, financial markets can be classified as ...

Golf Corporation

Liquidity Ratios: Current Ratio for the year 2012 = Current Assets / Current Liabilities Current Ratio for the year 2012 = 2,000 / 2,000 Current Ratio for the year 2012 = 1 Current Ratio for the year 2013 = Current Assets / Current Liabilities Current Ratio for the year 2013 = 3,000 / 4,000 Current Ratio for the year 2013 = 0.75 Quick Ratio for the year 2012 = Current Assets – Inventory – Prepayments / Current Liabilities Quick Ratio for the year 2012 = 2,000 - 500/ 2,000 Quick Ratio for the year ...

- Introduction The report is the second part of the SIM and Statistical arbitrage assignment. This report describes the process which has been done in the first part. It includes the collecting of the necessary information and data, a determination of the stocks, analysis of this data and the obtained results. - Stocks Analyzed

The average return of News Corporation is higher than the average return of Commonwealth Bank of Australia. The standard deviation of the first one is lower than the standard deviation of the second company. Therefore, the stock of the News Corporation is more efficient ...

Solvency Ratios:

These ratios indicate the long term solvency of the company, i.e., if the company will be able to honor its long term obligation. Furthermore, it also helps in understanding the capital structure of the company. Below discussed are the solvency ratios of Debenhams Inc: i) Debt to Equity: Debt/ Equity (Debenhams, 2013) ii) Interest Coverage Ratio: Operating Earnings/ Interest Expense iii) Debt to Capital Employed Ratio: Debt/ Capital Employed (Mckeith, Collins, 2013) *Debt= Total Debt *Capital Employed: Total Assets- Current Liabilities

Analysis:

The above analysis of the company using Solvency Ratios indicates that, over a year, ...

- Introduction The report describes the process of the analysis of two stocks which has been done using the Single Index Model. It includes collecting and sorting the data, analysis this data using the SIM and regression analysis and the explanation and the evaluation of the results. The findings are useful for decision making in the financial planning. - Stocks Analyzed The table above contains the information about two analyzed stocks: the company name, stock code, relevant sector, the average return and the standard deviation of the return. Last two points have been computed using the ...

i) Calculating cost of equity using CAPM Model: Capital Asset Pricing Model, often abbreviated as ‘CAPM’, is the most fundamental concept in the investment theory of present time. This is an equilibrium model that predicts the expected return on a stock, given the expected return on the market, the stock’s beta-coefficient and the risk free rate. Considered from the borrower point of view, this model is used to calculate the cost of equity for the company using the following formula: Cost of Equity= RFR+ Beta(Equity Risk Premium)

Below is the detailed explanation of cost of equity calculated for Tim Hortons Inc:

Risk Free Rate: This refers to rates being offered by ...

AES is a leading independent supplier of electricity in the world with more than $33 billion in assets. Rob Venerus, the director of Corporate Analysis and Planning group was faced with a task of calculating the capital cost of the business. Many financial information and results were collected from subsidiaries in June 2003. The manager was obligated to develop a methodology to use the data to determine the costs of capital significantly in valuation and for capital budgeting. The group was created to solve the financial crisis, current and future strategic challenges. The global economic instability had adverse effects such as ...