Analyze companys capital structure and its cost of capital

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Reference no: EM131527501

Corporate Financial Management Assignment

This coursework should be presented in the form of a Management Report which is divided into sections as follows: Title/Front Page (Students Name and Matriculation Number, Course, Name of the Module), Contents Table, Executive Summary, Coursework, Bibliography and References, Appendices.Coursework should bearound 3500 words in length (excluding appendices) and in typed format.

Coursework tasks:

1. Undertake a Risk Profile Analysis of the chosen company over at least the last 5 years. More specifically, using both accounting and market-based risk measures, estimate and explain the meaning, significance and sources of the key risks facing the company.

This analysis must cover the following lines of investigation:

i) Analysis of growth rate and asset turnover.
ii) Analysis of operating profit margin and business risk of the company.
iii) Analysis of the financial risk of the company.
iv) Analysis of the systematic risk of the company over the last 5 years.
v) Analysis of profitability ratios (ROA and ROE).
vi) In the light of the above analysis, highlight the key risks and what sort of actions management should take to manage it.

In this section, students are expected to undertake trend and comparative analysis of the key ratios that highlight any aspect of risk.

2. Analysis of the company's capital structure and its cost of capital.

3. Analysis of the company's value using;

a) Net Asset Value Approach
b) The Dividend Valuation Model
c) The Price-Earnings Ratio approach
d) Rappaport's Shareholder Value Model

4. Analysis of the company's dividend policy.

Text Books

The following ebooks are available in RGU Library.

Berk and DeMarzo, "Corporate Finance - The Core", 3rd edition, Pearson Education Inc.

Arnold, G., "Corporate Financial Management", 5th edition, Pearson

Lumby and Jones, "Corporate Finance, Theory and Practice" 8th edition, SOUTH-WESTERN CENGAGE Learning

Pike and Neale, "Corporate Finance and Investment, Decisions and strategies 6thedition, FT - Prentice Hall

Other Textbooks

Brealey, Myers and Allen, "Principles of Corporate Finance" 11th edition, McGraw Hill.

Reference no: EM131527501

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