project 465 fin (Graded A+) - use as a guide only - 26003

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This is about Finance-Valuation course; such as WACC, CAPM, etc. No beginner but high intellectual tutor in Finance is wanted to help me out here, please!
write about 1400 words plus exhibits. However, in order to execute them, you need to read and make analyze from the"mini-case", and the data from the spreadsheet.
 As you are answering those 3 questions,  incorporation of calculation of WACC, CAPM, etc, all that good stuffs calculations are of course needed (this would be shown in exhibits of your work). By the way, In the Note attachment, the text in BLUE is just a note how my professor will grade this Project, so I guess that'd help how you make this project an A+ work :)
1400 words Financial written analysis + EXHIBITS needed. See files attached, download them, and read the instructions there on how to do this assignment. This assignment should be an A++ brilliant work :)
Serious Inquiries only if you want to help me with this work. Message me if ur interested.
This is an Intermediate-Expert work in finance. If ur really great in Finance, Please help! Thanks so much


Instructions: Please read the following mini?case, and download the spreadsheet file included in the posting. Please use the information provided in the spreadsheet to answer the following questions

as completely as possible. For each question, it is important that you clearly highlight and explain key

methodologies, computations, and results within the scope of your answers. Please highlight important

assumptions you are making within your analysis. Finally, if you utilize any information from outside the

case, please provide a clear citation of your source. Please also see “note from my professor” down below so you know what is expected to get a good grade for this project! I WANT AN A+ work please J


Here are the Questions for this Project:


1) Note that the forecasted balance sheet is already balanced. Please “back out” an estimate of the

additional financing needed (AFN) forecast for Company X. Use the balance sheet forecast to

discuss how the AFN is allocated across different balancing figures in the forecast.


2) Estimate the value of Company X’s equity (per share) given the financial statement forecast and

other relevant case information. Provide Dr. Eafil a complete discussion of how you arrive at the

value estimate.


3) What additional information would you need to assess whether you can use this valuation to

make a recommendation as to whether to proceed with the acquisition of Company X’s stock?




Mini – Case for this Project

You are serving as an intern for EE Corporation, a holding company with diverse subsidiaries ranging

from a seafood operation to space exploration. You were hired by the company’s founder, Dr. Eafil,

because of your seemingly strong foundations in financial analysis of corporate financial statements and

company valuation. Based on your interview, you gather that Dr. Eafil has a very basic knowledge of

fundamentals of finance. However, he made it clear that he does not like financial jargon used by his

interns. As Dr. Eafil explained, “If you must use financial jargon, you better follow with a quick

explanation! Otherwise, I might make you explain to my minions who are not as patient and

understanding as I am.”


On your first day, Dr. Eafil gives your first assignment. He is considering buying a large retail?oriented

company with a very strong brand reputation. He simply calls the target, “Company X.” Dr. Eafil explains

that he is quite excited about the possibility of being able to reach so many consumers worldwide if he

were to own “Company X.” He mentions that “Company X” is asking $65 per share. He gives you the

information shown in Tables 1, 2, and 3.          


Table 1 shows historic financial statement and ratio information for EE Corporation.

Table 2 shows historic financial statement information and a set of financial ratios for “Company X.”

Table 3 shows a forecasted income statement and balance sheet for “Company X” that was prepared by

the last finance intern at EE Corporation.


When you ask whether you might be able to contact the prior

intern, Dr. Eafil mentions an “unfortunate accident” that occurred prior to the intern being able to do

anything further with the forecast. Upon discussions with some of EE’s employees, you learn that quite a

few “unfortunate accidents” have befallen finance interns in the past. They all have noticed that interns

who do not make Dr. Eafil unhappy seem to avoid these “accidents.”


You compiled the following notes regarding EE Corporation’s and Company X’s costs of capital based on

various conversations with Dr. Eafil and some others on his staff.


• Dr. Eafil more or less understands the concepts surrounding cost of capital estimation such as

WACC and CAPM. As mentioned before, he doesn’t like jargon so you need to try to explain

these estimations in clear language.


• U.S. Treasury rates are very close to zero percent for short maturities. Rates are approximately

1?3/4 percent for 10?year Treasuries, 2?1/2 percent for 20?year Treasuries, and 3 percent for 30?

year Treasuries.


• EE Corporation is privately owned, but is widely diversified. The company’s holdings seem very

much to be a mirror of the broader economy.


• You found “beta” estimates for Company X’s stock from several published sources. These values

range from 0.68 to 1.22.


• The “unlevered beta” for Company X’s industry is reported as equal to 1.15 through a reputable

data source.


• Dr. Eafil has VERY strong opinions about the stock market, and is forecasting 8% annual returns

on the overall stock market. He understands that there will be many fluctuations, but believes

that 8% is the “right” annually compounded rate to think about for any long?run valuations.


Solution Description


Answer (2).docx
Answer (2).docx