Comments to help you fill in yellow data entry boxes are in blue or red font. Take one row at a START HERE CURRENCY: SCALING: x USD TOTAL REVENUES Growth Rate vs Prior Year Total Operating Expenses OPERATING INCOME or (Loss) Operating Margin Interest expense Interest & other income (expense) INCOME (LOSS) BEFORE INCOME TAXES Provision for (or benefit from) Income Taxes Discontinued Operations Income (Loss), Net NET INCOME OR (LOSS) Weighted average (Number of) Diluted Shares Outstanding DILUTED EARNINGS OR (LOSS) PER SHARE Net Income or (Loss), from Above Depreciation and Amortization Expense Other Operating Sources and (Uses) Cash Flow from Operating Activities Purchases of property & equip., & other capital expenditures Other Investing Activities Cash Flow from Investing Activities Increase or (Decrease) in Debt Increase or (Decrease) in Common Stock Dividend Payments Other Financing Activities Cash Flow from Financing Activities Cumulative Translation Adjustment NET CASH FLOW Free Cash Flow 20201106185535tera_casandra_module_2_final_submission Valuation Printed 11/6/2020 Page 22 of 36 Boeing Co. - COMPANY VALUATION (Unaudited; USD 1000000) Fiscal Year --> VALUATION CALCULATIONS FREE CASH FLOW "FCF" (from above) NET PRESENT VALUE "NPV" OF FUTURE FREE CASH FLOWS NPV @ discount rate of 5.0% NPV @ discount rate of 10.0% NPV @ discount rate of 18.0% If you had bought the whole company at the end of fiscal 2019 for its actual market value of ---> Free Cash Flows w/Initial Investment Cumulative (initial cash outflow and future FCF's) Positive cumulative cash flows during the 10-year period? Internal Rate of Return (IRR) MODIFIED INTERNAL RATE OF RETURN (MIRR) Financing Rate Reinivestment Rate MIRR ECONOMIC VALUE ADDED (EVA), ALSO CALLED ECONOMIC PROFIT Assumed Tax Rate (for NOPAT calculation below) Net Operating Profit After Tax (NOPAT) Invested Capital WACC EVA Cash Flows NOTES: 20201106185535tera_casandra_module_2_final_submission Valuation Printed 11/6/2020 Page 23 of 36 This tab is used for the corporate valuation report (Final Project I). Enter data (forecasts based on assumption CURRENCY: SCALING: x Boeing Co. - COMPANY VALUATION (Unaudited; USD 1000000) Fiscal Year --> TOTAL REVENUES Growth Rate vs Prior Year Total Operating Expenses OPERATING INCOME or (Loss) Operating Margin Interest expense Interest & other income (expense) INCOME (LOSS) BEFORE INCOME TAXES Provision for (or benefit from) Income Taxes Discontinued Operations Income (Loss), Net NET INCOME OR (LOSS) Weighted average (Number of) Diluted Shares Outstanding DILUTED EARNINGS OR (LOSS) PER SHARE Net Income or (Loss), from Above Depreciation and Amortization Expense Other Operating Sources and (Uses) Cash Flow from Operating Activities Purchases of property & equip., & other capital expenditures Other Investing Activities Cash Flow from Investing Activities Increase or (Decrease) in Debt Increase or (Decrease) in Common Stock Dividend Payments Other Financing Activities Cash Flow from Financing Activities Cumulative Translation Adjustment NET CASH FLOW Free Cash Flow 20201106185535tera_casandra_module_2_final_submission Valuation Printed 11/6/2020 Page 24 of 36 Boeing Co. - COMPANY VALUATION (Unaudited; USD 1000000) Fiscal Year --> VALUATION CALCULATIONS FREE CASH FLOW "FCF" (from above) NET PRESENT VALUE "NPV" OF FUTURE FREE CASH FLOWS NPV @ discount rate of 5.0% NPV @ discount rate of 10.0% NPV @ discount rate of 18.0% If you had bought the whole company at the end of fiscal 2019 for its actual market value of ---> Free Cash Flows w/Initial Investment Cumulative (initial cash outflow and future FCF's) Positive cumulative cash flows during the 10-year period? Internal Rate of Return (IRR) MODIFIED INTERNAL RATE OF RETURN (MIRR) Financing Rate Reinivestment Rate MIRR ECONOMIC VALUE ADDED (EVA), ALSO CALLED ECONOMIC PROFIT Assumed Tax Rate (for NOPAT calculation below) Net Operating Profit After Tax (NOPAT) Invested Capital WACC EVA Cash Flows NOTES: 20201106185535tera_casandra_module_2_final_submission Valuation Printed 11/6/2020 Page 25 of 36 This tab is used for the corporate valuation report (Final Project I). Enter data (forecasts ba CURRENCY: SCALING: x Boeing Co. - COMPANY VALUATION (Unaudited; USD 1000000) Fiscal Year --> TOTAL REVENUES Growth Rate vs Prior Year Total Operating Expenses OPERATING INCOME or (Loss) Operating Margin Interest expense Interest & other income (expense) INCOME (LOSS) BEFORE INCOME TAXES Provision for (or benefit from) Income Taxes Discontinued Operations Income (Loss), Net NET INCOME OR (LOSS) Weighted average (Number of) Diluted Shares Outstanding DILUTED EARNINGS OR (LOSS) PER SHARE Net Income or (Loss), from Above Depreciation and Amortization Expense Other Operating Sources and (Uses) Cash Flow from Operating Activities Purchases of property & equip., & other capital expenditures Other Investing Activities Cash Flow from Investing Activities Increase or (Decrease) in Debt Increase or (Decrease) in Common Stock Dividend Payments Other Financing Activities Cash Flow from Financing Activities Cumulative Translation Adjustment NET CASH FLOW Free Cash Flow 20201106185535tera_casandra_module_2_final_submission Valuation Printed 11/6/2020 Page 26 of 36 Boeing Co. - COMPANY VALUATION (Unaudited; USD 1000000) Fiscal Year --> VALUATION CALCULATIONS FREE CASH FLOW "FCF" (from above) NET PRESENT VALUE "NPV" OF FUTURE FREE CASH FLOWS NPV @ discount rate of 5.0% NPV @ discount rate of 10.0% NPV @ discount rate of 18.0% If you had bought the whole company at the end of fiscal 2019 for its actual market value of ---> Free Cash Flows w/Initial Investment Cumulative (initial cash outflow and future FCF's) Positive cumulative cash flows during the 10-year period? Internal Rate of Return (IRR) MODIFIED INTERNAL RATE OF RETURN (MIRR) Financing Rate Reinivestment Rate MIRR ECONOMIC VALUE ADDED (EVA), ALSO CALLED ECONOMIC PROFIT Assumed Tax Rate (for NOPAT calculation below) Net Operating Profit After Tax (NOPAT) Invested Capital WACC EVA Cash Flows NOTES: 20201106185535tera_casandra_module_2_final_submission Valuation Printed 11/6/2020 Page 27 of 36 Powered by Clearbit Boeing Co. (The) (NYS: BA) Issue: Boeing Co.(NYS:BA) Time Period: 5 years Frequency: daily Adjusted Prices Historical Pricing Date 12/31/2019 12/31/2018 12/29/2017 12/30/2016 12/31/2015 Open 325.41 320.5 296.94 156.49 145.96 High 326.57 323.64 297.3 156.79 145.96 Low 323.32 318.75 294.83 154.96 144.5 Close 325.76 322.5 294.91 155.68 144.59 Volume 4960102 3555779 1824118 2028382 2105078 Price Move (%) -0.2 1.93 -0.49 -0.01 -1.24 Powered by Clearbit Boeing Co. (The) (NYS: BA) Exchange rate used is that of the Year End reported date As Reported Annual Income Statement Report Date Currency Audit Status 12/31/2019 USD Not Qualified Consolidated Yes Scale Millions Sales of products 66094 Sales of services 10465 Total revenues 76559 Cost of products 62877 Cost of services 9154 Boeing Capital interest expense 62 Total costs & expenses 72093 Gross profit 4466 Income (loss) from operating investments, net -4 General & administrative expense 3909 Research & development expense, net 3219 Gain (loss) on dispositions, net 691 Earnings (loss) from operations -1975 Other income (loss), net 438 Interest & debt expense 722 Earnings (loss) before income taxes - U.S. Earnings (loss) before income taxes - non-U.S. Earnings (loss) before income taxes -2259 Current U.S. federal income tax expense (benefit) -308 Current non-U.S. income tax expense (benefit) 169 Current U.S. state income tax expense (benefit) -161 Total current income tax expense (benefit) -300 Deferred U.S. federal income tax expense (benefit) -953 Deferred non-U.S. income tax expense (benefit) -3 Deferred U.S. state income tax expense (benefit) -367 Total deferred income tax expense (benefit) -1323 Income tax expense (benefit) -1623 Net earnings from continuing operations Net earnings (loss) -636 Less: earnings available to participating securites Net earnings available to common shareholders Weighted average shares outstanding - basic 565.4 Weighted average shares outstanding - diluted 565.4 Year end shares outstanding 562.909 Net earnings (loss) per share - basic -1.12 Net earnings (loss) per share - diluted -1.12 Cash dividends per share 8.22 12/31/2018 USD Not Available Yes Millions 90229 10898 101127 72922 8499 69 81490 19637 111 4567 3269 75 11987 92 475 11604 1873 169 97 2139 -996 -4 5 -995 1144 10460 579.9 585.5 567.641 18.05 17.85 7.19 12/31/2017 USD Not Qualified Yes Millions 83204 10188 93392 68365 7631 70 76066 17326 204 4094 3179 21 10278 129 360 9615 432 10047 1276 149 23 1448 405 -1 -2 402 1850 8197 6 8191 603.2 610 591.039 13.6 13.43 5.97 12/31/2016 USD Not Qualified Yes Millions 84399 10172 94571 72713 8018 59 80790 13781 303 3616 4627 -7 5834 40 306 5175 393 5568 1193 133 15 1341 -618 -4 -46 -668 673 4895 3 4892 635.5 642.8 617.152 7.7 7.61 4.69 Number of full time employees Total number of common stockholders Foreign currency translation adjustments 140800 108310 128 150500 113517 -104 12/31/2019 12/31/2018 12/31/2017 USD USD USD Not Not Not Qualified Available Qualified Consolidated Yes Yes Yes Scale Millions Millions Millions Cash & cash equivalents 9485 7637 8813 Short-term & other investments 545 927 1179 Commercial customer contracts 2059 U.S. government contracts 1121 1877 5989 Commercial airplanes 29 1542 Global services 1967 1472 Defense, space & security customers 220 760 Reinsurance receivables 467 Other accounts receivable 2 348 Less valuation allowance - accounts receivable 73 57 62 Accounts receivable, net 3266 3879 10516 Unbilled receivables, net 9043 10025 Current portion of customer financing, net 162 460 309 Long-term contracts in progress 1187 2129 13889 Commercial aircraft programs 66016 52753 52861 Commercial spare parts, used aircraft, general stock materials 9419& other inventories 7685 5688 Inventory before advances & progress billings 72438 Less advances & progress billings -28094 Inventories, net of advances & progress billings 76622 62567 44344 Other current assets 3106 2335 Total current assets 102229 87830 65161 Customer financing, net 2136 2418 2740 Land 527 546 530 Buildings & land improvements 14288 14109 14125 Machinery & equipment 15723 15221 14577 Construction in progress 1306 1337 1081 Gross property, plant & equipment 31844 31213 30313 Less accumulated depreciation 19342 18568 17641 Property, plant & equipment, net 12502 12645 12672 Goodwill 8060 7840 5559 Acquired intangible assets, net 3338 3429 2573 Deferred income taxes 683 284 341 Investments 1092 1087 1260 Other assets, net 3585 1826 2027 Total assets 133625 117359 92333 Accounts payable 15553 12916 12202 Accrued compensation & employee benefit costs 5582 6841 6659 737 MAX customer concessions & other considerations 7389 Accrued environmental 570 555 524 Accrued product warranties 1267 1127 1211 Accrued forward loss recognition 1681 1488 1683 Accrued dividends payable 1159 1160 1005 Accrued income taxes payable 670 485 380 12/31/2016 USD Not Qualified Yes Millions 8801 1228 4639 2432 733 526 567 65 8832 428 12801 52048 5446 70295 -27096 43199 62488 3773 535 13796 13569 1790 29690 16883 12807 5324 2540 332 1317 1416 89997 11190 5720 562 1414 1385 866 89 As Reported Annual Balance Sheet Report Date Currency Audit Status 161100 100750 -27 153000 104376 -86 Other accrued liabilities 4550 Accrued liabilities 22868 Advances & billings in excess of related costs 51551 Unsecured debt securities 1099 Non-recourse debt & notes 21 Finance lease obligations 71 Commercial paper 6109 Other notes 40 Short-term debt & current portion of long-term debt 7340 Total current liabilities 97312 Deferred income taxes 413 Accrued retiree health care 4540 Accrued pension plan liability, net 16276 Other long-term liabilities 3422 Unsecured debt securities 20783 Commercial paper 6109 Non-recourse debt & notes 37 Capital lease obligations 229 Other notes 144 Total debt 27302 Less: short-term debt & current portion 7340 Long-term debt 19962 Common stock 5061 Additional paid-in capital 6745 Treasury stock, at cost 54914 Retained earnings 50644 Currency translation adjustments -128 Unrealized gains & (losses) on certain investments 1 Unrealized gains & (losses) on derivative instruments -84 Defined benefit pension plans & other postretirement benefits -15942 Accumulated other comprehensive income (loss) -16153 Total shareholders' equity -8617 Noncontrolling interests 317 Total equity -8300 3152 14808 50676 1151 25 57 1895 62 3190 81590 1736 4584 15323 3059 11564 1895 62 156 170 13847 3190 10657 5061 6768 52348 55941 -15083 339 71 410 3830 15292 27440 599 33 52 600 51 1335 56269 1839 5545 16471 2015 10150 600 94 138 135 11117 1335 9782 5061 6804 43454 45320 -15 -1 44 -13404 -13376 355 57 412 4655 14691 23869 255 33 57 39 384 50134 1338 5916 19943 2221 9524 127 138 163 9952 384 9568 5061 4762 36097 40714 -143 -2 -127 -13351 -13623 817 60 877 12/31/2018 USD Not Available Yes Millions 10460 202 2114 93 -3 -75 247 -795 -1826 568 12/31/2017 USD Not Qualified Yes Millions 8197 202 2069 113 2 -21 287 -1821 -1085 12/31/2016 USD Not Qualified Yes Millions 4895 190 1910 90 -7 7 369 112 3755 (1) Accumulated amortization - other assets: As Reported Annual Cash Flow Report Date Currency Audit Status 12/31/2019 USD Not Qualified Consolidated Yes Scale Millions Net earnings (loss) -636 Share-based plans expense 212 Depreciation & amortization 2271 Investment/asset impairment charges, net 443 Customer financing valuation adjustments 250 Loss (gain) on dispositions, net -691 Other charges & credits, net 334 Excess tax benefits from share-based payment arrangements Accounts receivable 603 Unbilled receivables 982 Inventories -12391 Other current assets -682 98 Accounts payable 1600 2 Accrued liabilities 7781 1117 Advances & progress billings 737 2636 Advances & billings in excess of related costs Income taxes receivable, payable & deferred -2476 -180 Other long-term liabilities -621 87 Pension & other postretirement plans -777 -153 Customer financing, net 419 120 Other assets & liabilities 196 610 Net cash flows from operating activities -2446 15322 Property, plant & equipment additions -1834 -1722 Property, plant & equipment reductions 334 120 Acquisitions, net of cash acquired -455 -3230 Contributions to investments -1658 -2607 Proceeds from investments 1759 2898 Purchase of distribution rights -127 -69 Proceeds from dispositions 464 Other investing activities -13 -11 Net cash flows from investing activities -1530 -4621 New borrowings 25389 8548 Debt repayments -12171 -7183 Repayment of distribution rights & other asset financing Contributions from noncontrolling interests 7 35 Stock options exercised 58 81 Excess tax benefits from share-based payment arrangements Employee taxes on certain share-based payment arrangements -248 -257 Common shares repurchased -2651 -9000 Dividends paid -4630 -3946 Other financing activities -15 Net cash flows from financing activities 5739 -11722 Effect of exchange rate changes on cash & cash equivalents -5 -53 Net increase/(decrease) in cash & cash equivalents, including 1758 restricted -1074 Net increase (decrease) in cash & cash equivalents Cash & cash equivalents at beginning of year Cash & cash equivalents, including restricted, at beginning7813 of year 8887 Cash & cash equivalents, including restricted, at end of year 9571 7813 Less restricted cash & cash equivalents, included in Investments 86 176 Cash & cash equivalents at end of year 9485 7637 Net income tax payments (refunds) 837 1326 Interest payments 973 616 As Reported Annual Retained Earnings Report Date Currency Audit Status 12/31/2019 USD Not Qualified Consolidated Yes Scale Millions Previous retained earnings 55941 Share-based compensation & related dividend equivalents -33 Cash dividends declared 4628 Retained earnings 50644 12/31/2018 USD Not Available Yes Millions 49618 -36 4101 55941 130 573 3570 857 94 -582 1017 -258 13344 -1739 92 -324 -3601 3639 -131 2 -2062 2077 -953 311 -132 -9236 -3417 -11350 80 12 8801 8813 896 527 622 726 -493 -810 -68 153 -696 -256 10499 -2613 38 -297 -1719 1209 2 -3380 1325 -1359 -24 321 -93 -7001 -2756 -9587 -33 -2501 11302 8801 1460 523 12/31/2017 USD Not Qualified Yes Millions 40714 -35 3556 45320 12/31/2016 USD Not Qualified Yes Millions 38756 -35 2902 40714 12/31/2015 USD Not Qualified Yes Millions 85255 10859 96114 73446 8578 64 82088 14026 274 3525 3331 -1 7443 -13 275 6828 327 7155 2102 122 21 2245 -297 4 27 -266 1979 5176 5176 4 5172 686.9 695 666.624 7.52 7.44 3.82 -38% -38% 21% 161400 123824 -92 12/31/2015 USD Not Qualified Yes Millions 11302 750 4864 2250 889 550 254 94 8713 212 13858 55230 6673 75761 -28504 47257 68234 3358 536 12397 13187 2242 28362 16286 12076 5126 2657 265 1284 1408 94408 10800 5624 566 1485 757 721 262 4599 14014 24364 1004 36 53 141 1234 50412 2392 6616 17783 2078 9351 163 150 300 9964 1234 8730 5061 4834 29568 38756 -39 -197 -12512 -12748 6335 62 6397 12/31/2015 USD Not Qualified Yes Millions 5176 189 1833 167 -5 1 364 -157 -1069 -1110 -238 2 1192 477 46 2470 167 -142 9363 -2450 42 -31 -2036 2590 39 -1846 1746 -885 399 157 -96 -6751 -2490 -7920 -28 -431 11733 11302 1490 488 12/31/2015 USD Not Qualified Yes Millions 36180 -25 2575 38756 FIN 330 Final Project I Guidelines and Rubric Overview Corporate financial managers must have a business-wide perspective to successfully navigate the corporate environment. The skills you will develop in this course will support you in your future business career and set the foundation for the concepts that will be covered in the next course, Multinational Corporate Finance. Your final project for FIN 330 will allow you to showcase your mastery of the varied skills a finance professional must obtain: It will require you to analyze a real-world corporation from a quantitative perspective while also investigating the challenges and decisions a manager must face. To accomplish this, your final assessment will be broken up into two separate but related projects. For your first project,, a corporate valuation report, you will choose one of the U.S. corporations from the provided list, analyze the historical financials of your chosen corporation using the provided Excel template, and estimate the value of your corporation in a brief report. The second final project is a risk management and ethical analysis that will focus on the same corporation, highlighting the management and leadership considerations and decisions required of top-level financial managers. In this written report, you will discuss ethics, corporate social responsibility, and the challenges related to attaining short-term and long-term goals. Combined, these two projects will assess your knowledge regarding the quantitative and qualitative concepts of corporate finance and leadership. The first final project is divided into two milestones, which will be submitted at various points throughout the course to scaffold learning and ensure quality final submissions. These milestones will be submitted in Modules Two and Five. The final corporate valuation report is due in Module Seven, and the final risk management and ethical analysis is due in Module Eight. In this assignment, you will demonstrate your mastery of the following course outcomes:    Estimate the value of corporations based on quantitative and qualitative analysis of financial history, industry trends, and projections of future performance Analyze the relationships between capital structure, risk, and cost of capital for informing financial decisions that can optimize the value of corporations Analyze challenges financial managers face regarding short-term and long-term planning for informing decision making Prompt Your corporate valuation report should analyze your chosen corporation from the provided list and estimate its overall value. Throughout this assignment, you will use a provided Excel template. To complete this assignment, you will submit both a written paper and the completed Excel template with the “Financial History,” “Capital Structure,” and “Valuation” tabs filled in. Specifically, the following critical elements must be addressed: I. Overview: This section of your report will be devoted to providing a thorough overview of the background of the corporation you selected and setting the foundation for your later discussion of the challenges financial managers face. Specifically, you must address the following: A. Describe the market to which your corporation belongs, identifying the products or services your corporation sells and the share of the market it has. B. Describe the customer base of your corporation and the top competitors for this customer base. Be sure to consider what motivates the customers and the challenges the organization faces in retaining the customer base. C. Describe the key inputs (and sources of those inputs) used to create the products or services, as well as the key resources for corporate operation (such as staff, facilities, technologies, etc.) and the extent to which attaining all these resources presents a challenge to the particular organization. D. Analyze key market trends and issues within the industry for potential risks to the organization. II. Financial History: The next section of your report should focus on the financial history and capital structure of your organization. A. Quantitatively analyze three years’ worth of the corporation’s finances using the provided Excel template. You will submit this template along with your report, and may embed pieces of the Excel template into your report to show key financial highlights in the following critical element. B. Summarize the financial highlights you determined from the analysis in the Excel template, explaining the significance of the key ratios for the overall financial health of the organization. III. Capital Structure: In the third section of your report, discuss the capital structure of the corporation. A. Outline the most recent year’s debt, equity, and total capital using the provided template to show the overall capital structure of the corporation. B. Articulate the corporation’s dividend policy and what impact it has on the investors. C. Analyze the relationship between capital structure, cost of capital, and risk, using examples from your chosen organization. D. Explain how the relationship between capital structure, cost of capital, and risk can help inform decision making and maximize corporate value. IV. Valuation: The final section of your report will focus on calculating current value, outlining assumptions, and estimating the future value of the corporation through forecasting the cash flows. Specifically, respond to the following: A. Calculate the current market value of equity for your corporation, using the three-year history and provided Excel template, and explain what it means for the corporation. B. Outline any assumptions you have made in calculating the current value and estimating the future value of the corporation, explaining why you made them and why they are important. (Hint: Assumptions can include growth rates, margins, trends, etc.) C. Estimate the current value of your corporation by forecasting the cash flows over five years using the provided Excel template, and explain your findings. Calculate EVA, NPV, IRR and MIRR. Milestones Milestone One: Overview and Financial History In Module Two, you will submit Milestone One, which provides you an opportunity to work on the overview and financial history sections of your Final Project I: Corporate Valuation. As part of this assignment, you will also complete specific elements of the provided excel template. This milestone will be graded with the Final Project I Milestone One Rubric. Milestone Two: Capital Structure and Valuation In Module Five, you will submit Milestone Two, which provides you an opportunity to work on the capital structure and valuation sections of your Final Project I: Corporate Valuation. As part of this assignment, you will also complete specific elements of the provided excel template. This milestone will be graded with the Final Project I Milestone Two Rubric. Final Submission: Corporate Valuation Report In Module Seven, you will submit your Final Project I: Corporate Valuation Report. It should be a complete, polished artifact containing all of the critical elements of the final product. It should reflect the incorporation of feedback gained throughout the course on your milestone assignments. This submission will be graded with the Final Project I Rubric. Final Project I Rubric Guidelines for Submission: Your corporate valuation report should be 6–9 pages in length, double spaced, with 12-point Times New Roman font, one-inch margins, and APA formatting. Along with your corporate valuation report, you will submit your complete Excel template as a separate file. You may use pieces of your Excel template as images within your report, but you must still submit the completed Excel template with your final report submission. Critical Elements Overview: Market Exemplary Meets “Proficient” criteria, and description demonstrates deep insight into the corporation’s place in the market (100%) Overview: Customer Meets “Proficient” criteria and makes cogent connections between customer base and competitors (100%) Proficient Accurately describes the market, products or services, and portion of the market held by the chosen corporation (85%) Accurately describes the customer base and the corporation’s top competitors for those customers (85%) Needs Improvement Describes the market, products or services, and portion of the market held by the chosen corporation, but lacks accuracy or necessary detail (55%) Describes the customer base and the corporation’s top competitors for those customers, but lacks accuracy or detail (55%) Not Evident Does not describe the market, products or services, and portion of the market held by the chosen corporation (0%) Value 4 Does not describe the customer base and the corporation’s top competitors (0%) 5 Overview: Resources Overview: Trends Meets “Proficient” criteria and shows keen insight into the varied resources required for corporate operation (100%) Meets “Proficient” criteria and shows keen insight into corporate risks associated with market-wide trends and issues (100%) Financial History: Excel Accurately describes the key inputs and resources the corporation needs (85%) Critically analyzes the market for key trends and issues that may pose risks for the corporation (85%) Correctly analyzes three years of corporate financial statements using the provided Excel template (100%) Financial History: Highlights Meets “Proficient” criteria and shows keen insight into the significance of specific financial calculations for determining financial health (100%) Accurately summarizes the financial highlights determined from the Excel analysis of the corporate financial statements, citing key ratios that give a picture of the overall financial health (85%) Capital Structure: Overall Meets “Proficient” criteria, and outline shows mastery of determining a corporation’s capital structure from financials (100%) Capital Structure: Dividend Policy Meets “Proficient” criteria and makes cogent connections between dividend policy and investor impact (100%) Accurately outlines the most recent year’s debt, equity, and total capital using the provided template to show the overall capital structure of the corporation (85%) Accurately articulates the corporation’s dividend policy and the impact it has on investors (85%) Describes the key inputs and resources the corporation needs but lacks accuracy or detail (55%) Analyzes the market for key trends and issues but lacks detail, logic, or focus on issues that may pose risks for the corporation (55%) Analyzes three years of corporate financial statements using the provided Excel template, but analysis contains miscalculations or is incomplete (55%) Summarizes the financial highlights determined from the Excel analysis of the corporate financial statements but lacks accuracy or details regarding key ratios that give a picture of the overall financial health (55%) Outlines the most recent year’s debt, equity, and total capital using the provided template, but with gaps in accuracy (55%) Does not describe inputs and resources the corporation needs (0%) 5 Does not analyze the market for trends and issues (0%) 4 Does not analyze three years of corporate financial statements using the provided Excel template (0%) 7.7 Does not summarize the financial highlights determined from the Excel analysis (0%) 7.7 Does not outline the most recent year’s debt, equity, and total capital using the provided template (0%) 9.6 Articulates the corporation’s dividend policy and its impact on investors, but does so inaccurately or with gaps in details (55%) Does not articulate the corporation’s dividend policy and its impact on investors (0%) 9.6 Capital Structure: Relationship Meets “Proficient” criteria and makes cogent connections between capital structure, cost of capital, and corporate risk (100%) Accurately analyzes the relationship between capital structure, cost of capital, and risk, using examples to highlight claims (85%) Capital Structure: Maximize Value Meets “Proficient” criteria and shows keen insight into using knowledge of the relationship between cost of capital, capital structure, and risk to maximize corporate value (100%) Accurately explains how the relationship between capital structure, cost of capital, and risk should inform corporate decision making and maximize corporate value (85%) Valuation: Current Value Meets “Proficient” criteria and shows mastery of determining current corporate market value (100%) Accurately calculates the current market value of the chosen corporation using the three-year history and provided Excel template, explaining findings in the report (85%) Valuation: Assumptions Meets “Proficient” criteria and shows keen insight into the role of assumptions in corporate valuation (100%) Clearly outlines reasonable assumptions, explaining why the assumptions were made and why they matter (85%) Valuation: Estimate Meets “Proficient” criteria and shows advanced grasp of future valuation (100%) Logically estimates the current value of the corporation through five-year cash flow forecasting using the provided Excel template (85%) Analyzes the relationship between capital structure, cost of capital, and risk, but lacks accuracy or does not use examples that highlight claims (55%) Explains how the relationship between capital structure, cost of capital, and risk should inform corporate decision making and maximize corporate value, but lacks accuracy or necessary detail (55%) Calculates the current market value of the chosen corporation using the threeyear history and provided Excel template, explaining findings in the report, but lacks accuracy in calculations or lacks detail in explanation of findings (55%) Outlines assumptions, explaining why the assumptions were made and why they matter, but with gaps in clarity or reason (55%) Estimates the current value of the corporation through fiveyear cash flow forecasting using the provided Excel template, but with gaps in logic or accuracy of calculations (55%) Does not analyze the relationship between capital structure, cost of capital, and risk (0%) 9.65 Does not explain how the relationship between capital structure, cost of capital, and risk should inform corporate decision making and maximize corporate value (0%) 9.65 Does not calculate the current market value of the corporation or does not explain findings in the report (0%) 7.7 Does not outline assumptions or explain why they were made and why they matter (0%) 7.7 Does not estimate the current value of the corporation through five-year cash-flow forecasting using the Excel template (0%) 7.7 Articulation of Response Submission is free of errors related to citations, grammar, spelling, syntax, and organization and is presented in a professional and easy-toread format (100%) Submission has no major errors related to citations, grammar, spelling, syntax, or organization (85%) Submission has major errors related to citations, grammar, spelling, syntax, or organization that negatively impact readability and articulation of main ideas (55%) Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas (0%) Total 5 100% FIN 330 Final Project I Milestone Two Guidelines and Rubric Overview: Corporate financial managers must have a business-wide perspective to successfully navigate the corporate environment. The skills you develop in this course will support you in your future business career as well as set the conceptual foundation for the future courses in your program. Your final project for FIN 330 will allow you to showcase your mastery of the varied skills a finance professional must obtain by requiring you to analyze a real-world corporation from a quantitative perspective while also investigating the challenges and decisions a manager must face. In this milestone, you will continue to work on elements of Final Project I, the corporation valuation report. Prompt: This milestone requires you to write a draft of the Capital Structure and Valuation sections (Sections III and IV) of Final Project I, the corporate valuation report. In this assignment, you will use the same corporation you focused on in Milestone One to expand upon the capital structure of the organization and the valuation of the corporation through forecasting. Specifically, the following critical elements must be addressed in this milestone: III. Capital Structure: In the third section of your report, discuss the capital structure of the corporation. A. Outline the most recent year’s debt, equity, and total capital using the provided Excel template to show the overall capital structure of the corporation. Please note: to complete this, you will use the same template you used in support of Milestone One, but this time you will be completing the “Capital Structure” tab. B. Articulate the corporation’s dividend policy and what impact it has on the investors. C. Analyze the relationship between capital structure, cost of capital, and risk, using examples from your chosen organization. D. Explain how the relationship between capital structure, cost of capital, and risk can help inform decision making and maximize corporate value. IV. Valuation: The final section of your report will focus on calculating current value, outlining assumptions, and estimating the future value of the corporation through forecasting the cash flows. Specifically, respond to the following: A. Calculate the current market value of equity for your corporation, using the three-year history and provided Excel template, and explain what it means for the corporation. You will submit this template along with your report, and may embed pieces of the Excel template into your report to help support your work in this section. Please note: this is the same template you used in support of Milestone One, but this time you will be completing the “Valuation” tab. B. Outline any assumptions you have made in calculating the current value and estimating the future value of the corporation, explaining why you made them and why they are important. (Hint: Assumptions can include growth rates, margins, trends, etc.) C. Estimate the current value of your corporation by forecasting the cash flows over five years using the provided Excel template, and explain your findings. Calculate EVA, NPV, IRR and MIRR. Guidelines for Submission: Your submission should be 3–4 pages in length, not including the Excel template you use to address sections IV.A and IV.C, above. The written submission should use 12-point Times New Roman font, double spacing, one-inch margins, and APA formatting. Be sure to submit both your written response and the completed Excel template when submitting this assignment. Any citations should follow APA guidelines. Critical Elements Capital Structure: Overall Capital Structure: Dividend Policy Capital Structure: Relationship Proficient (100%) Accurately outlines the most recent year’s debt, equity, and total capital using the provided template to show the overall capital structure of the corporation Accurately articulates the corporation’s dividend policy and the impact it has on investors Accurately analyzes the relationship between capital structure, cost of capital, and risk, using examples to highlight claims Capital Structure: Maximize Value Accurately explains how the relationship between capital structure, cost of capital, and risk should inform corporate decision making and maximize corporate value Valuation: Current Value Accurately calculates the current market value of the chosen corporation using the three-year history and provided Excel template, explaining findings in the report Valuation: Assumptions Clearly outlines reasonable assumptions, explaining why the assumptions were made and why they matter Needs Improvement (80%) Outlines the most recent year’s debt, equity, and total capital using the provided template, but with gaps in accuracy Not Evident (0%) Does not outline the most recent year’s debt, equity, and total capital using the provided template Value Articulates the corporation’s dividend policy and its impact on investors, but does so inaccurately or with gaps in details Analyzes the relationship between capital structure, cost of capital, and risk, but lacks accuracy or does not use examples that highlight claims Explains how the relationship between capital structure, cost of capital, and risk should inform corporate decision making and maximize corporate value, but lacks accuracy or necessary detail Calculates the current market value of the chosen corporation using the three-year history and provided Excel template, explaining findings in the report, but lacks accuracy in calculations or lacks detail in explanation of findings Outlines assumptions, explaining why the assumptions were made and why they matter, but with gaps in clarity or reason Does not articulate the corporation’s dividend policy and its impact on investors 15 Does not analyze the relationship between capital structure, cost of capital, and risk 15 Does not explain how the relationship between capital structure, cost of capital, and risk should inform corporate decision making and maximize corporate value 15 Does not calculate the current market value of the corporation or does not explain findings in the report 12 Does not outline assumptions or explain why they were made and why they matter 12 15 Valuation: Estimate Logically estimates the current value of the corporation through five-year cash flow forecasting using the provided Excel template Articulation of Response Submission has no major errors related to citations, grammar, spelling, syntax, or organization Estimates the current value of the corporation through five-year cash flow forecasting using the provided Excel template, but with gaps in logic or accuracy of calculations Submission has major errors related to citations, grammar, spelling, syntax, or organization that negatively impact readability and articulation of main ideas Does not estimate the current value of the corporation through five-year cash-flow forecasting using the Excel template 12 Submission has critical errors related to citations, grammar, spelling, syntax, or organization that prevent understanding of ideas Total 4 100% Running head: BOEING COMPANY 1 The Boeing Company Tera L. Casandra FIN-330 Southern New Hampshire University BOEING COMPANY 2 The Boeing Company For over 100 years, the Boeing Company has been leaders in the frontier and purveyor of flight capabilities. The official beginnings of Boeing on April 26, 1917 and the sale of 50 seaplanes as trainers to the Unites States Navy within 90 days to the world’s largest aerospace company today, Boeing’s legacy is being the United States’ biggest manufacturing exporter. Products The Boeing Company has moved beyond only manufacturing commercial and military aircraft. Boeing Co. has designed and produced satellites, as well as IT and communication systems, electric and defense systems and performance-based training and logistics. (Boeing, 2020) Aerospace Market As the Aerospace Industries Association reports, the industry provides 1.8% of the total U.S gross domestic production. (Aerospace Industries Association, 2020) With the establishment of the U.S. Space Force and the announcement of NASA’s Artemis program, space systems has seen a 7% in growth in sales and a 6.9% growth to the U.S. GDP contributions (Aerospace Industries Association, 2020) Customer Boeing has a customer care base that includes not only the manufactured product but also support for the life of the system. Boeing has dedicated training centers and supply chain management which includes spare parts planning and component overhaul/repair which reduces customer costs and improves efficiency. Boeing has the capability to monitor and manage the performance of the aircraft, managing the maintenance program, monitor on-time performance and aircraft configurations. The company also includes flight planning software and technology BOEING COMPANY 3 provided by ForeFlight and Jeppesen used by commercial and military pilots and flight planners alike. (Boeing, 2020) Top competitors to the Boeing Company include Airbus, a major competitor in the same fields, being the largest defense supplier in Europe and Lockheed Martin which is also in the same industry with artificial intelligence, radar, cyber security and electronic warfare in addition to space, maritime and energy systems. Trends Key trends as seen the last two three years is the establishment of the United States Space Force and the resurgence of space exploration and missions to Mars. Specifically, within the last 10 months post Corona-virus 2019 (Covid-19) emergence, while the commercial industry growth has slowed the space subsector has seen sustainable growth. (Aerospace Industries Association, 2020) Risks regarding commercial sales is the delays requested by commercial transportation companies such as American Airlines Incorporated for aircraft purchased or leased prior to the outbreak of Covid-19. Financial History. The Financial trends of Boeing had been consistent in 2017 and 2018, however, with multiple Boeing 737 crashes that are reportedly attributed to design flaws to keep costs low and an unethical atmosphere regarding conflicts of interest between the FAA (Federal Aviation Administration and government officials. (Levin, 2020) The aircraft crashes also crashed the net income of the Boeing Company to a deficit of $636 million. The delivery of the Boeing 737 that had been ordered were put on hold during investigations and so the net income and cost of goods sold dropped. Government purchases from Boeing at this point have not been impacted and the company has shifted to deliverables that do not include the 737. BOEING COMPANY 4 Capital Structure BOEING COMPANY 5 References Aerospace Industries Association. (2020, September 15). 2020 Facts & Figures: U.S. Aerospace & Defense. Aerospace Industries Association. https://www.aia-aerospace.org/report/2020-factsfigures/ BBC News. (2020, August 27). Europe to start Boeing 737 Max test flights. BBC News. https://www.bbc.com/news/business-53930694 Boeing. (2020, January 31). SEC Filings: Boeing Company (10-K). SNHU: Mergent Online. https://www-mergentonline-com.ezproxy.snhu.edu/printedgar.php?pagetype=companyfilings&id=19111317&type=HTML&compname=BOEING%20CO Boeing. (2020). Boeing History Chronology. In Boeing. https://www.boeing.com/resources/boeingdotcom/history/pdf/Boeing_Chronology.pdf Levin, A. (2020, September 16). Sweeping Failures and Insufficient Oversight Led to Boeing 737 Max Crashes, Scathing House Report Finds. Time; Time. https://time.com/5889376/boeing-737-maxhouse-report/
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