What is nopat

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Reference no: EM132927978

Questions

1. Does it make any sense to calculate betas against local indexes when accompany as a great part of its operations outside this local market? have two examples: BBVA and Santander.

2. Is the Free Cash Flow (FCF) the sum of the equity cash flow and the debt cash flow?

3. What is NOPAT (Net Operating profit After tax)?

4. What is EBITDA(Earning before interest ,Taxes, Depreciation and Amortization)?

5. I do not understand the meaning of working capital requirements, I think it should be similar to working capital (Current Assets-current liabilities).Am I right?

6. Why can we not calculate the required return (Ke)from the Gordon- Shapiro model(p0= DIV0(1+g)/(ke-g) instead of using the CAPM ?As we know the current dividend (Div0)and the current share price(p0),we can obtain the growth rate of the dividend from the formular g=ROE(1-p)/(1-ROE(1-p),p being the payout.

7. Assume I calculate g as ROE (1-p)/(1-ROE(1-p)) and the Ke from the CAPM. I replace both values in the formula PER =(ROE(1+g) -g)/ROE (Ke-g) but the PER I obtain is totally different from the one I get by dividing the quotation of the share to the earnings per share. Is it possible to interpret that difference as an overvaluation or undervaluation of that share on the market?

8. I was assigned a valuation of the shares of a pharmaceutical laboratory. Which valuation method is more convenient?

9. I need to know how to value a company well, but I cannot clearly see the valuation process of a company starting from its past income statements. What are the systematical steps I need to take? Firstly , I think I should elaborate the provisional statements for the following fiscal years and then calculate the cash flows, discount them at the present moment (with a discount factor), add the terminal value to it and the difference between the book net value and the market value of intangibles. I really need that these steps be methodical and easy to understand so I can use them as a guide when valuing a company.

10. I cannot seem to start valuation .in order to calculate E+D=VA(FCF;WACC) I need the WACC and in order to calculate the WACC I need D and E .where should I start?

Reference no: EM132927978

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