Case, Nike WACC

Case, Nike WACC - Case: Nike WACC Issue: o Portfolio...

Info iconThis preview shows pages 1–2. Sign up to view the full content.

View Full Document Right Arrow Icon
Case: Nike WACC Issue: o Portfolio manager trying to decide whether to invest in Nike stock Market price: o $42 o But intrinsic value at WACC of 12%: $37 Cost of capital: o Minimum rate of return acceptable on new projects o What actual returns will Nike give if bought? Who sets the WACC? o The market Debt is tax deductible: o Must adjust debt to account for this in WACC Cost of debt: o Joanna did it wrong o WACC should be forward looking, not historical
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Background image of page 2
This is the end of the preview. Sign up to access the rest of the document.

This note was uploaded on 06/11/2011 for the course BUSI 408 taught by Professor Croce during the Spring '08 term at UNC.

Page1 / 2

Case, Nike WACC - Case: Nike WACC Issue: o Portfolio...

This preview shows document pages 1 - 2. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online