This document provides instructions for a FIN 516 Week 2 Mini Case Assignment. Students are asked to select a major US-based public company, excluding banks and insurance companies, and write a 7-8 page paper answering 17 questions about the company's industry, financial risks, capital structure, costs of debt/equity/capital, stock performance, and risk assessment. Sources used must be cited in a bibliography page.

1. DEVRY FIN 516 Week 2 Mini Case
Assignment (3 Sets)
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FIN 516 Week 2 Mini Case Assignment (3 Sets)
Select a major industrial or commercial company based in the
United States, and listed on one of the major stock exchanges in the
United States. Each student should select a different company.
Avoid selecting an insurance company or a bank, as the fnancial
ratios for these fnancial businesses are different. Write a 7 – 8 page
double spaced paper answering and demonstrating with
calculations and fnancial data the following questions:
1. What is the name of the company? What is the industry sector?
2. What are the operating risks of the company?
3. What is the fnancial risk of the company (the debt to total
capitalization ratio)?
4. Does the company have any preferred stock?

2. 5. What is the capital structure of the company?: Short term portion
of Long Term Debt, Long Term Debt, Preferred Stock (if any), and
market value of Common Stock issued and outstanding?
6. What is the company’s current actual Beta?
7. What would the Beta of this company be if it had no Long Term
Debt in its capital structure? (Apply the Hamada Formula.)
8. What is the company’s current Marginal Tax Rate?
9. What is the Cost of Debt, before and after taxes?
10. What is the Cost of Preferred Stock (if any)?
11. What is the Cost of Equity?
12. What is the cash dividend yield on the Common Stock?
13. What is the Weighted Average Cost of Capital of the company?
14. What is the Price Earnings Multiple of the company?
15. How has the company’s stock been performing in the last 5
years?
16. How would you assess the overall risk structure of the company
in terms of its Operating Risks and Financial Risk (Debt to
Capitalization Ratio)?
17. Would you invest in this company? Why? Or Why not?
18. The last page of your paper should be a Bibliography of the
sources you used to prepare this paper.