ACCT 5160
Daily Assignment 1
Market Efficiency vs. Valuation
The value of securities in the market comes from available information on
the financial health of a company. This information comes from ac
A5160 - GDuke Fall2014 Chapter8 - slide 1
Chapter 8 fair value accounting
Fair value accounting
Example of fair value accounting
Equation page 180, acct principle 7
Example
A5160 - GDuke Fall2014 Chap
A5160 - GDuke Fall2014 Lecture 2 - slide 1
Chapter 2
The basic model:
value is pv of future cash
yet cant know future cash and
maybe even discount rate changes
Growth
Value of 3M?
A5160 - GDuke Fall2
A5160 - GDuke Fall2013 Intro Lecture - slide 1
Chapter 1
Return to Fundamentals
What is this chapter about?
Value the set of methods for determining the
appropriate price to pay for a firm.
Fundamenta
A5160 - GDuke Fall2014 Lecture 3 - slide 1
Chapter 2
TSLA earnings announcement last Wed
Revisit PV of future cash, how implement this?
ROCE and ROA
residual income
AEG
A5160 - GDuke Fall2014 Lecture
A5160 - GDuke Fall2014 Lecture 3c - slide 1
Chapter 3 some gems
good accounting minimizes speculation so that one
can deploy the accounting to challenge speculation in
the market place. page 64
A valu
FINANCIAL PLANNING EXAMPLE
Background info
Bushman Airways
Historic Financial Statements
Current (2013 and 2012) financial statements
Balance sheet
Assets
Current
Plant, Property and Equip. (cost)
Acc
TwoStageFCFEDiscountModel
Comparing DDM and FCFE Models: Two Stage Valuation
Inputs for FCFE Calculation
Current Net Income =
$100.00
(in currency)
Current Dividends =
$30.00
(in currency)
Current Cap
1. Current Ratio
Year
Current Assets
Current Liabilities
Current Ratio
#DIV/0!
#DIV/0!
#DIV/0!
2. Quick Ratio (Acid-Test Ratio)
Year
Cash & Equivalents + Short-term Investments + A/R
Current Liabiliti
s13 section 1 Problem #1 Initial Analysis
The Grocery Store
Info
$ in thousands
Store cost
Depreciable cost
Cap ex
Depreciable PPE
Depreciation rate
Real growth rate
Inflation rate
Sales in year 1 at
FocusInvestor.com: The Focused Few
A special note of thanks goes to John Kish, Devon
Everhart, Futile France, and Kuang-Yu Liu for their
assistance on this project.
Version 1.1
Decent overview of the
Dividend Discount Model
Assumptions
1. The firm is expected to grow at a higher growth rate in the first period.
2. The growth rate will drop at the end of the first period to the stable growth rate.
A5160 - GDuke Fall2014 Lecture 4 - slide 1
Lecture 4 Mon 17 Nov 2014 (update)
Residual earnings
Abnormal earnings growth
midterm exam next Monday
DuPont (RoA and RoCE) if time permits
This is an updat
Current Market Expectations
12 Month Target: $46
Expected EPS 2018: $3.66
Current Market Ratings
Morningstar
Equity Research
Credit Suisse
Research
Neutral
Market Edge
Argus 12 Month
Rating
Buy
Hold
N
Balance Sheet ($ millioms)
CURRENT ASSETS
Cash and cash equivalents
Marketable Securities-current
Accounts Receivables, net
Inventories
Deferred Project costs
Deferred Tax
Prepaid and Other Current As
Executive Summary
Based on my calculations throughout the semester, only a minor amount of speculation is
factored into the stock price of TJX Companies, Inc. The market is optimistic about future
gro
Megan Feltz
ACCT 5160
For the final report, I will be valuing TJX Companies, Inc. to determine whether or not
their stock is fairly valued. Much of the factors that I will use for valuation purposes h
Daily Assignment 9
Cash flows, net income, and comprehensive income
Chapter 9 returns to accounting and emphasizes historical returns. There is a focus on the
income statement and on the balance sheet
Introduction to Financial Statement Analysis
What is Accounting?
AICPAs definition says the following: The Function of Accounting is to provide
quantitative information primarily financial in nature
Daily Assignment 1
Estimating Cash Flows for TJX Companies
For your project company:
(1) find cash flows for last three years,
(2) estimate cash flows for next ten years,
(3) select a discount rate an
TJX P/E ratio
Daily Assignment 3 - due Thr 12 Sep 2013
For your project company:
(1) compute price/earnings ratio with current stock price,
(2) what does this number tell us about your company?
(3) wh
TJX Speculation in Stock Price
ACCT 5160
Minor Speculation in Stock Price
Question:
For your project company
1. Compare your valuation to stock price
2. Give a short description of how much speculatio
Daily Assignment 8
TJX Required Rate of Return
For your project company:
1. Estimate the parameters of the equation from the end of chapter 7
2. Calculate r, the required rate of return.
3. What does
Daily Assignment 6
ACCT 5160
CAPM
To the right is given the closing Dow Jones Industrial Average index for twelve dates.
Find the closing stock price of your project company for the same twelve dates.
Lat
36.8092188283
City
New York
Boston
Philadelphia
Charlotte
Atlanta
New Orleans
Miami
Dallas
Houston
Chicago
Detroit
Cleveland
Indy
Denver
Minneapolis
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Salt Lake City
LA
SF
SD
Seattle
Lat
Lon