How to Calculate WACC And Assess It

profileSleek Solutions
 (Not rated)
 (Not rated)
Chat

Introduction. Introduce your firm which may include (but is not limited to) the following: Date it went public, mission and objectives, current product line, current share price, any awards, etc. You may wish to review the current 10K report, the corporate website, and Mergent Online which is available in our library. Be sure you reference your sources in the paper and at the end in a Works Cited page.
CEO and CFO Report: In this section, review the current letter to the shareholder. What direction is your firm taking? Who is the CEO? What is his background?
Global Corporate Citizenship: Does your firm consider itself to be a good global corporate citizen? What programs does it have in place which illustrate this? Does it have a specific statement regarding global citizenship? Check out the World Economic Forum or other resources to learn about the importance of this initiative.  http://www.weforum.org/issues/corporate-global-citizenship
Financial Statement Report: Go to the 10K report and specifically search within those reports to any references to growth in product lines and costs and WACC. What product lines are growing? What is the firm developing? How is it performing? Is it targeting specific countries? Indicate any references to WACC and cost controls here. For your financial statement report, you may wish to create a table of key financial statement variables for the current year such as revenues (sales), EBIT, net income, cash, receivables, inventory, accounts payable, notes payable, and short term investments (if any).
WACC Report: In this section, create a summary table of the key variables you imported into the WACC equation and present your final WACC percentage to two decimal places (e.g., 5.55%, 2.22%). Go to www.cfo.com and search for the Milano and Theriault article on WACC (April 13, 2012: Is Financial Leverage Good for Shareholders?). In light of this article, what is your opinion of WACC for your company?
Analyst Report: Go to the Library's homepage and look up the Value Line report for your company. What do analysts have to say about its direction? Be sure you include a short table of key information (upper left corner and lower right corner) and interpret those numbers.
Conclusion: Students tend to think that finance is cut and dry. A student arrives at "an answer" and that "answer" is either correct or incorrect. Hopefully, the tutorial has showed you that this is not the case. WACC is driven by the inputs a CFO decides to enter. The CFO's choice of risk-free rate, market rate of return, Beta, ROE, etc. determine the magnitude and direction of WACC. What did you learn about your company? Is it effective in controlling costs? Would you invest in this company?
Include a Works Cited Page and cite sources inside your paper (or on the Power Point).
((( 1. Open up the 'highlighted instructions" and "AOL1 Highlighted" files.
If you compare the AOL paper to the instructions, you will see that I have highlighted information in different colors. The highlighted information is information that does not need to be changed.

2. The rest of the information in the paper will need to be deleted and changed based on the instructions. Just follow the instructions and answer the questions in paper format.

3. I have included the Excel file that has all of the math so you can compare it in the project.

4. This is the Boeing 10k annual report that you will need for the paper - https://materials.proxyvote.com/Approved/097023/20140227/AR_195723/#/6/

5. Feel free to read my old paper if you need any other ideas for this project.
))

    • 9 years ago
    A++ Answer
    NOT RATED

    Purchase the answer to view it

    blurred-text
    • attachment
      how_to_calculate_wacc_and_assess_it.doc