Financial management

anaplJ
timer Asked: Apr 29th, 2017

Question Description

I have group presentation .. all what we have to do read the case and answer the questions..
so my part in this presentation to answer question number 4 from the case .
I have to write about the problem in the case .. and I think this is the problem :
Price earning ratio of 11x was below market of 29X
One page for the question 4 and half page for the problem.

Unformatted Attachment Preview

4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 1/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 2/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 3/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 4/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 5/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 6/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 7/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 8/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 9/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 10/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 11/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 12/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 13/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 14/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 15/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 16/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 17/18 4/26/2017 Financial Management PRINTED BY: bbadraig12@su.edu. Printing is for personal, private use only. No part of this book may be reproduced or transmitted without publisher's prior permission. Violators will be prosecuted. https://bookshelf.vitalsource.com/#/books/9781121424722/cfi/188!/4/4@0.00:0.00 18/18 Case 35. DELUXE CORPORATION 1. What are the risks associated with Deluxe’s business and strategy? What financing requirements do you foresee for the firm in the coming years? (Hint: how will the risk factors affect the firm’s forecast presented in case Exhibit 4 and the firm’s future need for funds?) 2. What are the main objectives of the financial policy that Rajat Singh must recommend to Deluxe Corporation’s board of directors? 3. Drawing on the financial ratios in case Exhibit 6, how much debt could Deluxe borrow at each rating level? What is the implied (or maximum) capitalization ratio at each rating category? (Complete the worksheet “Analysis of Flexibility” in the Excel template attached.) How would your results be different if the “Downside EBIT” is used in your estimation? 4. Using Hudson Bancorp’s estimates of the costs of debt and equity in case Exhibit 8, determine the company’s weighted average cost of capital (WACC) in worksheet “WACC” in the attached Excel template. Which rating category has the lowest overall cost of funds? 5. Read the introduction of the FRICTO framework in case book pp.456-457 (i.e., Part VI of Case 32. Structuring Corporate Financial Policy). Based on the FRICTO (flexibility, risk, income, control, timing and other) framework and your analysis above, what should Singh recommend regarding: • The target bond rating • The company’s current debt level and level of flexibility • The mix of debt and equity • Any other issues you believe should be brought to the attention of the CEO and the board story Bookmarks People Window Help Files Bookshelf Online: Financial [4] Wed 7:02 Wf.vitalsource.com/#/books/9781121424722/cf/191/4/4@0.00:37.1 X Google Translate X Case 35 - Case 35 Deluxe Source of data: Company reports. By year-end 2001, the market had responded favorably to the spinoff and restruc- turing efforts—the firm's share price had grown by more than 65% over the year, outperforming the S&P 500 Index, which had fallen nearly 20%. Over the preced- ing decade, however, the firm's share price growth had lagged the broad market indexes. Exhibit 1 gives a 10-year summary of the financial characteristics of the firm, including share prices and data on comparable market performance. From 1998 to 2001, Deluxe Corporation's compound annual rate of sales growth was -4.0%, which reflected the growing maturity of the market for paper checks in the United States. Consistent with the rceived maturity of the market segment, Deluxe's 2001 price earnings ratio (P/E) of 11.0X hovered well below the broader market's P/E of 29.5%. Concerns about ravenmeeruth and death
User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

This question has not been answered.

Create a free account to get help with this and any other question!

Related Tags

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors