Finance-AW75

Finance-AW75 Online Services

 

FINANCIAL Management II – Take Home Assignment

 
The industry of mobile phones is experiencing a period of growing competition that erodes the profit margin and that is killing many competitors. In the last five years the field has become an oligopolistic market with room for a very limited numbers of players of big dimensions.
 
In such an environment the companies pay attention to the risk linked to their financial structure choices and on the impact they may show on the market value of their shares.
 
Mr. Krunhan, CFO of Sound signal Company Ltd. Is considering the situation of his firm, listed on a foreign Stock Exchange because he is interested in evaluating the firm and in carrying out a comparison to a possible peer. Currently Sound signal Company has 100.000 shares listed on the market with a book value per share equal to 100 dollars; it issued also 100.000 bonds with a book value of 100 dollars each one.
 
The current price of a share is 500 dollars and the market value of every bond is 110 dollars.
 

a) Estimate the enterprise value of Sound signal Company and calculate its leverage ratio (D/E).
 
b) Sound signal Company is expected to generate free cash flows to firm constant and equal to 400,000 dollars per year without changes in Net Working capital nor in the financial structure. Under these assumptions and keeping in in mind also that the company does not have to face new investments, help Mr. Krunhanto estimate his weighted average cost of capital.
 

c) On the basis of the cost of debt resulting from the probability of default recognized to the company, that implies to add a premium of 2% to an initial reference interest rate equal to 2%, estimate the coherent return expected by the shareholders. You know that the taxation corporate rate is 30%.
 
You can read more about our case study assignment help services here.
 

How it Works

How It works ?

Step 1:- Click on Submit your Assignment here or shown in left side corner of every page and fill the quotation form with all the details. In the comment section, please mention Case Id mentioned in end of every Q&A Page. You can also send us your details through our email id support@assignmentconsultancy.com with Case Id in the email body. Case Id is essential to locate your questions so please mentioned that in your email or submit your quotes form comment section.

Step 2:- While filling submit your quotes form please fill all details like deadline date, expected budget, topic , your comments in addition to Case Id . The date is asked to provide deadline.

Step 3:- Once we received your assignments through submit your quotes form or email, we will review the Questions and notify our price through our email id. Kindly ensure that our email id assignmentconsultancy.help@gmail.com and support@assignmentconcultancy.com must not go into your spam folders. We request you to provide your expected budget as it will help us in negotiating with our experts.

Step 4:- Once you agreed with our price, kindly pay by clicking on Pay Now and please ensure that while entering your credit card details for making payment, it must be done correctly and address should be your credit card billing address. You can also request for invoice to our live chat representatives.

Step 5:- Once we received the payment we will notify through our email and will deliver the Q&A solution through mail as per agreed upon deadline.

Step 6:-You can also call us in our phone no. as given in the top of the home page or chat with our customer service representatives by clicking on chat now given in the bottom right corner.

Case Approach

Scientific Methodology

We use best scientific approach to solve case study as recommended and designed by best professors and experts in the World. The approach followed by our experts are given below:

Defining Problem

The first step in solving any case study analysis is to define its problem carefully. In order to do this step, our experts read the case two three times so as to define problem carefully and accurately. This step acts as a base and help in building the structure in next steps.

Structure Definition

The second step is to define structure to solve the case. Different cases has different requirements and so as the structure. Our experts understand this and follow student;s university guidelines to come out with best structure so that student will receive best mark for the same.

Research and Analysis

This is the most important step which actually defines the strength of any case analysis. In order to provide best case analysis, our experts not only refer case materials but also outside materials if required to come out with best analysis for the case.

Conclusion & Recommendations

A weak conclusion or recommendations spoil the entire case analysis. Our expert know this and always provide good chunks of volume for this part so that instructors will see the effort put by students in arriving at solution so as to provide best mark.

Related Services

 

Mr. Kruhnan is analyzing the industry. The well-known firm Mobile Devices Ltd. captures his attention. Mobile Devices is actually a competitor for Soundsignal.
 
Mobile Devices in in a stationary condition too and is able to generate free cash flow equal to 4.000.000 dollars every year. These free cash flows show the same systematic risk that characterizes the money expected by Soundsignal Company.
 
Mobile Devices is an all-equity financed firm. Its number of shares is equal to 120.000.
 
d) Help Mr. Krunhan to estimate the cost of equity for Mobile Devices Ltd.
 
e) Help him also in the estimation of the enterprise value and of the equity value for Mobile Devices.
 
f) Finally let’s imagine that Mobile Devices decides to issue 150.000 bonds at par for a total amount of 15 million,with the aim of buying back shares. In this case what would Mr. Krunhan conclude about the new enterprise value and the new equity value? How about the Debt/Equity Ratio?
 
Product code: Finance-AW75
 
Looking for best Finance-AW75 online ,please click here
 

Summary
User Rating
5 based on 1 votes