1. The document provides financial information about a company including its capital structure, long-term debt instruments, preferred stock, and common stock.
2. Key figures given include annual revenues of $9 billion, a capital structure of 34% long-term debt, 3% preferred stock, and 63% common stock. Details are provided on two long-term debt instruments, the preferred stock, and the common stock.
3. The document poses 10 questions asking the reader to calculate various metrics like yield and required rate of return based on the information provided, and to evaluate whether investments in the company's bonds and stock would be recommended.
Working capital cycle
Net working assets to sales/revenue
Income gearing
Gearing ratio
Earnings Per Share (EPS)
Price earnings ratio/(P/E)
Dividend Yield
Dividend cover
Dividend per share
Edexcel Unit 2 - Investment ratios
If you need tute : https://www.slideshare.net/secret/HWzeaKRZChVF33
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All the best..!
Fundamental Analysis by Vivek SrivastavaAxis Direct
Fundamental Analysis is a study of factors (company specific and external environment) that affect the value of stock. This program will help you to understand the impact of factors on the valuation of the stock, analysis of the environment and interpretation of financial statement.
For more information visit : https://simplehai.axisdirect.in/learn/eclasses
Working capital cycle
Net working assets to sales/revenue
Income gearing
Gearing ratio
Earnings Per Share (EPS)
Price earnings ratio/(P/E)
Dividend Yield
Dividend cover
Dividend per share
Edexcel Unit 2 - Investment ratios
If you need tute : https://www.slideshare.net/secret/HWzeaKRZChVF33
If you need password please request in comments.
All the best..!
Fundamental Analysis by Vivek SrivastavaAxis Direct
Fundamental Analysis is a study of factors (company specific and external environment) that affect the value of stock. This program will help you to understand the impact of factors on the valuation of the stock, analysis of the environment and interpretation of financial statement.
For more information visit : https://simplehai.axisdirect.in/learn/eclasses
This is the fourth presentation for the University of New England Graduate School of Business unit, GSB711 - Managerial Finance. This presentation looks at returns on different types of investment.
1Valuation ConceptsThe valuation of a financial asset is b.docxeugeniadean34240
1
Valuation Concepts
The valuation of a financial asset is based on determining the present value of future cash flows. Thus we need to know the value of future cash flows and the discount rate to be applied to the future cash flows to determine the current value.
The market-determined required rate of return, which is the discount rate, depends on the market’s perceived level of risk associated with the individual security. Also important is the idea that required rates of return are competitively determined among the many companies seeking financial capital. For example ExxonMobil, due to its low financial risk, relatively high return, and strong market position, is likely to raise debt capital at a significantly lower cost than can United Airlines, a financially troubled firm. This implies that investors are willing to accept low return for low risk, and vice versa. The market allocates capital to companies based on risk, efficiency, and expected returns—which are based to a large degree on past performance. The reward to the financial manager for efficient use of capital in the past is a lower required return for investors than that of competing companies that did not manage their financial resources as well.
Throughout this course, we apply concepts of valuation to corporate bonds, preferred stock, and common stock. For that purpose we have to be aware of the basic characteristics of each form of security as part of the valuation process. We have to consider the following:
· The valuation of a financial asset is based on the present value of future cash flows.
· The required rate of return in valuing an asset is based on the risk involved.
· Bond valuation is based on the process of determining the present value of interest payments plus the present value of the principal payment at maturity.
· Preferred stock valuation is based on the dividend paid.
· Stock valuation is based on determining the present value of the future benefits of equity ownership.
List of terms:
required rate of return
That rate of return that investors demand from an investment to compensate them for the amount of risk involved.
yield to maturity
The required rate of return on a bond issue. It is the discount rate used in present-valuing future interest payments and the principal payment at maturity. The term is used interchangeably with market rate of interest.
real rate of return
The rate of return that an investor demands for giving up the current use of his or her funds on a noninflation-adjusted basis. It is payment for forgoing current consumption. Historically, the real rate of return demanded by investors has been of the magnitude of 2 to 3 percent.
inflation premium
A premium to compensate the investor for the eroding effect of inflation on the value of the dollar.
risk-free rate of return
Rate of return on an asset that carries no risk. U.S. Treasury bills are often used to represent this measure, although longer-term government securities have al.
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USDA Loans in California: A Comprehensive Overview.pptxmarketing367770
USDA Loans in California: A Comprehensive Overview
If you're dreaming of owning a home in California's rural or suburban areas, a USDA loan might be the perfect solution. The U.S. Department of Agriculture (USDA) offers these loans to help low-to-moderate-income individuals and families achieve homeownership.
Key Features of USDA Loans:
Zero Down Payment: USDA loans require no down payment, making homeownership more accessible.
Competitive Interest Rates: These loans often come with lower interest rates compared to conventional loans.
Flexible Credit Requirements: USDA loans have more lenient credit score requirements, helping those with less-than-perfect credit.
Guaranteed Loan Program: The USDA guarantees a portion of the loan, reducing risk for lenders and expanding borrowing options.
Eligibility Criteria:
Location: The property must be located in a USDA-designated rural or suburban area. Many areas in California qualify.
Income Limits: Applicants must meet income guidelines, which vary by region and household size.
Primary Residence: The home must be used as the borrower's primary residence.
Application Process:
Find a USDA-Approved Lender: Not all lenders offer USDA loans, so it's essential to choose one approved by the USDA.
Pre-Qualification: Determine your eligibility and the amount you can borrow.
Property Search: Look for properties in eligible rural or suburban areas.
Loan Application: Submit your application, including financial and personal information.
Processing and Approval: The lender and USDA will review your application. If approved, you can proceed to closing.
USDA loans are an excellent option for those looking to buy a home in California's rural and suburban areas. With no down payment and flexible requirements, these loans make homeownership more attainable for many families. Explore your eligibility today and take the first step toward owning your dream home.
Resume
• Real GDP growth slowed down due to problems with access to electricity caused by the destruction of manoeuvrable electricity generation by Russian drones and missiles.
• Exports and imports continued growing due to better logistics through the Ukrainian sea corridor and road. Polish farmers and drivers stopped blocking borders at the end of April.
• In April, both the Tax and Customs Services over-executed the revenue plan. Moreover, the NBU transferred twice the planned profit to the budget.
• The European side approved the Ukraine Plan, which the government adopted to determine indicators for the Ukraine Facility. That approval will allow Ukraine to receive a EUR 1.9 bn loan from the EU in May. At the same time, the EU provided Ukraine with a EUR 1.5 bn loan in April, as the government fulfilled five indicators under the Ukraine Plan.
• The USA has finally approved an aid package for Ukraine, which includes USD 7.8 bn of budget support; however, the conditions and timing of the assistance are still unknown.
• As in March, annual consumer inflation amounted to 3.2% yoy in April.
• At the April monetary policy meeting, the NBU again reduced the key policy rate from 14.5% to 13.5% per annum.
• Over the past four weeks, the hryvnia exchange rate has stabilized in the UAH 39-40 per USD range.
Introduction to Indian Financial System ()Avanish Goel
The financial system of a country is an important tool for economic development of the country, as it helps in creation of wealth by linking savings with investments.
It facilitates the flow of funds form the households (savers) to business firms (investors) to aid in wealth creation and development of both the parties
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
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If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
how to swap pi coins to foreign currency withdrawable.DOT TECH
As of my last update, Pi is still in the testing phase and is not tradable on any exchanges.
However, Pi Network has announced plans to launch its Testnet and Mainnet in the future, which may include listing Pi on exchanges.
The current method for selling pi coins involves exchanging them with a pi vendor who purchases pi coins for investment reasons.
If you want to sell your pi coins, reach out to a pi vendor and sell them to anyone looking to sell pi coins from any country around the globe.
Below is the contact information for my personal pi vendor.
Telegram: @Pi_vendor_247
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What website can I sell pi coins securely.DOT TECH
Currently there are no website or exchange that allow buying or selling of pi coins..
But you can still easily sell pi coins, by reselling it to exchanges/crypto whales interested in holding thousands of pi coins before the mainnet launch.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and resell to these crypto whales and holders of pi..
This is because pi network is not doing any pre-sale. The only way exchanges can get pi is by buying from miners and pi merchants stands in between the miners and the exchanges.
How can I sell my pi coins?
Selling pi coins is really easy, but first you need to migrate to mainnet wallet before you can do that. I will leave the telegram contact of my personal pi merchant to trade with.
Tele-gram.
@Pi_vendor_247
2. Case Summary
The data
Previous year revenues: + $ 9 billion
Capital structure: 34% Long Term Debt / 3% Preferred Stocks / 63 % Common Stocks
Long-Term Debt Preferred Stock Common Stock
LTD 1: c = 91/8 %, n = 26 years, =$ 930
= 7 years, Premium = $ 104.4375
LTD 2: c = 9%, n = 9 years, = $ 972.50
Par Value = $1000
D= $ 2.75 , Par Val = $30.50
P = $ 30
Voting rights: Only if company is
arrears on 6 or more quarterly
dividends = ¼ vote per share
In case of liquidation: $ 30.50 +
Accumulated dividends
n = 98 million shares
Stock par value = $ 3.125
P= $ 405/8
Quarterly dividend = $ 0.385
g = 9.7 %
Max reinvestment = $ 1000 / month
3. 1. Look at the 91/8 percent coupon bond. What are its
current yield, its yield to-first call, and its yield-to-maturity?
Remind: Current Yield is the annual income (interest or dividends) divided by the current price of the
security. This measure looks at the current price of a bond instead of its face value and represents the
return an investor would expect if he or she purchased the bond and held it for a year.
Other calculations forms: - Manual calculation of time value of money
- Excel Sheet
- Online Calculators
4. 1. Look at the 91/8 percent coupon bond. What are its
current yield, its yield to-first call, and its yield-to-maturity?
Remind: Yield to first call is computed for a callable bond that is not currently callable. The actual
calculation is the same as the Yield to Maturity with the only difference being that instead of using a par
value and the stated maturity the analyst will use the call price and the first call date in calculating the yield.
Other calculations forms: - Manual calculation of time value of money
- Excel Sheet
- Online Calculator
5. 1. Look at the 91/8 percent coupon bond. What are its
current yield, its yield to-first call, and its yield-to-maturity?
Remind: Yield to maturity is the rate that will make the present value of a bond's cash flows equal to its
market price plus accrued interest.
Other calculations forms: - Manual calculation of time value of money
- Excel Sheet
- Online Calculator
6. 2. Do you think this bond will be called? Why or why not?
7. 3.What would be the value of the 91/8 percent coupon bond if the time to maturity
was 10 years rather than 26 years? Can you explain why your answer is correct?
The coupon rate (coupon yield = nominal yield) is simply the coupon payment (C)
as a percentage of the face value (F): c= C / Par Value.
8. 4. What is the required rate of return for the preferred stock? How does this rate
compare to the YTM for the HPI 91/8 percent bond? Is this difference what you
would have expected from a risk / return standpoint? Why or why not?
The required rate of return for preferred stock is higher than YTM for the HPI 9 bond. The reason is related
with the degree of risk. As we know, preferred stocks are riskier than bonds.
9. 5. In the event of liquidation, HPI preferred stockholders are
entitled to $ 30.50 plus accrued dividends. Does this mean
that preferred stockholders will receive that amount?
The preferred stocks are
cumulative which means that the firm
cannot pay the common stocks until
it has paid all its obligations with
accumulated dividends during the
previous periods. One thing it’s sure:
they will paid before common
shareholders but this does not mean
that they will be paid for the entire
amount. They will receive as much
as possible from the liquidation.
10. 6.What are the dividend yield and the expected
capital gains yield for HPI common stock?
Remind : Dividend yield is a financial ratio that shows how much a company pays out in dividends each
year relative to its share price. In the absence of any capital gains, the dividend yield is the return on
investment for a stock.
11. 6. What are the dividend yield and the expected
capital gains yield for HPI common stock?
Remind : Capital gain yield is the price appreciation component of a security's (such as a common
stock) total return. For stock holdings, the capital gains yield will be the change in price divided by the
original (purchase) price.
12. 7. Given that HPI is selling for $ 405/8 what is its required rate
of return?
Remind: Constant growth model (Gordon Model Growth) is a model for determining the intrinsic value
of a stock, based on a future series of dividends that grow at a constant rate. Given a dividend per share
that is payable in one year, and the assumption that the dividend grows at a constant rate in
perpetuity, the model solves for the present value of the infinite series of future dividends (Investopedia).
13. 8. Assume that the risk-free rate is 7 percent and that the expected return of the
market is 12 percent. According to the security market line valuation model,
what is the required rate of return for HPI common stock if its beta is 1.10?
Remind: The security market line (SML)is the
line that reflects an investment's risk versus its
return, or the return on a given investment in
relation to risk. The measure of risk used for the
security market line is beta. The line begins with
the risk-free rate (with zero risk) and moves
upward and to the right. As the risk of an
investment increases, it is expected that the return
on an investment would increase. An investor with
a low risk profile would choose an investment at
the beginning of the security market line. An
investor with a higher risk profile would thus
choose an investment higher along the security
market line.
14. 9. Using the constant growth valuation model, find the present
value of HPI common stock. Would you buy or sell?
This common stock has a sale price $ 405/8 which is lower that the stock present value. As we can see, the
stock is under valuated and in this case a “smart strategy” will be to buy the stocks with a lower price.
15. 10. The constant growth model is used in textbooks as a conceptual model to explain
changes in stock prices. Is the model also of value for the actual valuation of stocks?
g = constant
Book theory!
Variable
growth
Dynamic
environment
Variable g:
More
accurate model
Three step model
Variable g:
Difficulties in
calculation