• April 7th, 2016

Equity valuation in practice

Paper, Order, or Assignment Requirements

Equity valuation in practice
The coursework is designed to apply valuation techniques to practice. As financial analysts working in the research department of AVI Securities, you are asked by a client to prepare a valuation report. For MacDonald’s corporation.
Value the stock in your chosen company using a discounted cash flow model, and make a final recommendation on your stock. You will be marked on the following tasks:
1. Justify your choice of discounted cash flow valuation model and the necessary assumptions. (25%) Marks.
2. Estimate the appropriate discount rate that you would require for the valuation. (25%)
3. Value the stock and assess the robustness of your results. (25%)
4. Produce a set of recommendations for investors based on your results. (25%).

Guidelines

• Perform your own calculations and analysis (including estimation of discount rate)

• based on raw data. Do not borrow the analysis from other sources.

• Please Put all calculations in excel (SHOW ALL steps please).
Valuation include
1- Discount Dividend Model (DDM)
2- Free cash flow to the firm (FCFF) and free cash flow to equity (FCFE).
3- Discount Cash Flow (DCF)
4- Price to sales ratio (P/S valuation) use 4 companies and compared with as same sector)
5- EBITDA valuation (use 4 companies and compared with as same sector)
6- P/E valuation (use 4 companies and compared with as same sector)
• Please justify your assumptions.
Create report from 3 pages, as exactly as attachment report.
• Please find attachments (Tom-tom NV) report As example

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