Excel Help Set 4 & 5: Sampling, Estimation and Hypothesis Testing
NORMDIST function returns the normal distribution for the specified mean and standard
Valuation of XYZ Refinery
Balance sheet data($mill)
400 (39 year MACRS)
4000 (10 year MACRS)
100 (15 year st. line)
Current portion of LTD
Tot Current Liab
C&J Energy Services, Inc.
JP Morgan Oil and Gas
Corporate Access Day
C&J Energy Services, Inc.
Certain statements and information in this presentation may constitute forward-looking statements within the
Assignment is to value Encore Wire on a control basis assuming a taxable purchase including
benefits of step up in basis of assets, including goodwill. I will discuss this in class. Assume
Encore is private.
Click on WIRE website to get mo
BUSINESS ENTERPRISE VALUATION ON CONTROL BASIS
CASH FLOW/INCOME METHOD
For residual value, pick low growth rate for residual
Pick capex consistent with residual growth ( low)
Set depreciation = capex in residual period
What distinguishes control vs. minor
Assignment is to value C&J Energy Services on a control basis assuming a taxable purchase
including benefits of step up in basis of assets, including goodwill aswe discussed.
Click on C&J website under for our investors to get more info. W
In Millions of the reported currency, except per share items.
S&P Capital IQ (Default)
Overview of Business
What is Value?
Depends on who is as
University of Texas at Dallas Presentation
Hong Kong +852.3551.2300
Los Angeles New York Chicago San Francisco Minneapolis Washington,
Fed Reserve website FINRA
Risk free rate 20 year treasury from Fed Reserve or CapIQ or Yahoo
For ERP (a.k.a. MRP) use 5%
Use CAPIQ to find comparable companies ( focus on industry )
Use comparable companies
1.The Damodaran survey article showed that for the g=0 case the Gordon Growth Model
yields the same value estimate for a firms equity using 1) Firm value based on WACC or 2) the
direct equity method based on the cost of equity, as long as the leverage ass
Is measured after subtracting after-tax interest expense,
because interest expense is deducted in the calculation of net
income (whereas FCF is calculated before the deduction of interest expense);
Includes after-tax nonoperating or other income,
Name of the Company
Fiscal Year End
Latest Year Financial
MINI Case: Analysis of the Conoco Phillips Gas Acquisition Project
Increase in NWC
MACRS depreciation rate ( 7 year)
Natural gas wellhead price (per MCF)
Volume (MCF per day)
Days per year
Fee to producer of natural gas (per MC
a.Does this project create shareholders value ? How much ? Should HMG undertake the investment ?