BusM 401 Todd Mitton Questions for Cooper Industries Instructions: Carefully study the Cooper case and do the analysis necessary to thoroughly answer the questions below. Prepare and attach exhibits that explain your decisions. Good answers will be backed up with quantitative support whenever possible (use the financial analysis skills that you have studied). The case will be graded based on the quality of your report, including the accuracy of your quantitative analysis, the strength and thoroughness of your arguments in support of your decisions, and the quality of the exposition (e.g., write clearly, avoid typos, format exhibits nicely). This case is worth 35 points. 1. Why is Nicholson File an acquisition target? Why is Cooper Industries interested in acquiring Nicholson File? 2. What does standard DCF methodology give you as the value of Nicholson’s common stock based on its current operating performance? If you arrive at an unusual estimate for the stock price (for example, a negative stock price), explain why this occurs. To answer this question, prepare cash flow projections for Nicholson for 1972-1976 and compute a terminal value
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