This assignment discuses a Company with international operations. Also, provides an analysis of cash flows to the firm. So, apply the Fama-French 3 factor model to infer a cost of capital. If your market allows it, so you consider a company with a US listing.
Company with international operations-cash flows to the firm
The following steps should guide you through the coursework: 1. Choose a company with international operations among those listed in LSE or any other stock exchange. Make sure the company has financial statement and price data for at least five years. You can now start writing the company background section of your coursework. Describe why you are valuing this company and give a good analysis of the company background with reference to its past performance, industry, economy etc
. 2. Calculate the cost of equity and the weighted average cost of capital for firm valuation by using different assumptions. Make sure you discuss the choice of estimation periods and processes you used for the risk-free rate, market premium, beta, cost of equity, cost of debt and the capital structure of the firm. 3. Also, apply the Fama-French 3 factor model to infer a cost of capital. If your market allows it, so you consider a company with a US listing.
Company with international operations-cash flows to the firm
See: 4. Calculate cash flows to the firm and cash flows to equity using different assumptions. Compare earnings based and cash-flow based valuation, why do they differ and which do you find a more credible valuation? 5. Calculate future cash flows using different estimates of growth rates for cash flows. Also, describe and justify your choice with reference to the company’s/sector’s data. 6. Calculate the value of the firm relative to its international or home-country peers. 7.Besides, calculate the value of the firm and the value of equity under different assumptions. Perhaps weight these scenarios, rather than average these scenarios. If you weight rather than average the scenarios you consider Decide what the value of the company is and how you use this for decision making.
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