100% tevredenheidsgarantie Direct beschikbaar na betaling Zowel online als in PDF Je zit nergens aan vast
logo-home
Summary Advanced Corporate Financial Management (E_BA_ACFM) €5,49   In winkelwagen

Samenvatting

Summary Advanced Corporate Financial Management (E_BA_ACFM)

 13 keer bekeken  1 keer verkocht

This summary is an extended version of ACFM lectures.

Voorbeeld 4 van de 187  pagina's

  • 20 oktober 2021
  • 187
  • 2021/2022
  • Samenvatting
Alle documenten voor dit vak (4)
avatar-seller
SophievA
Week 1 - Lecture 1 - Value creation, financial statements, and from FS to CFs 3
Part 1 - Value creation 3
Part 2 - Investment in Growth (MVA and EVA) 4
Part 3 - Financial Statements 8
Part 4 - From Financial Statements to CFs 16
Part 5 - Special topic: provisions or contingencies 17
Part 6 - Projections A 20

Week 1 - Lecture 2 22
Part 2.1 - Capital Budgeting 22
Part 2.2 - Alternative investment decision methods 29
Part 2.3 - Capital Asset Pricing Model (CAPM) 34
Part 2.4 - Real Options 36
Part 2.5 - Corporate Governance 36
Part 2.6 - Executive Compensation 38
Part 2.7 - Shareholder Voting 40
Part 2.8 - Shareholder vs Stakeholder view 44

Week 2 - Lecture 3 - Capital Structure and Valuation 46
Part 1 - Basics and MM1958 46
Part 2 - MM1963 48
Part 3 - WACC after and before tax; levered and unlevered betas 53
Part 4 - Costs of financial distress and Miller 1977 56

Week 2 - Lecture 4 - Capital Structure and Valuation 60
Part 1 - Agency theory, Jensen and Meckling 1976 60
Part 2 - Free Cash Flow theory, Jensen 1986 64
Part 3 - Pecking Order Theory, Myers 1984 and Myers and Majluf 1984 65
Part 4 - Shyam-Sunder and Myers 1999 66
Part 5 - Summary and Tips 66
Part 4.6 - Risky Debt 69
Part 4.7 - Risky Debt Problem solved 70

Week 3 - Lecture 5 - CAPM, build up method, APT and factor models 72
Part 5.1 - Capital Asset Pricing Model (CAPM) 72
Part 5.2 - CAPM and Build Up model 75
Part 5.3 - Arbitrage Pricing Theory [part 1] 79
Part 5.4 - Arbitrage Pricing Theory [part 2] 81
Part 5.5 - Arbitrage Pricing Theory [part 3] 85
Part 5.6 - ‘Best Practices’ in Estimating the Cost of Capital: an update 88

Week 3 - Lecture 6 - Payout Policy 90
Part 6.1 - Payout Policy and Dividend Irrelevance 90
Part 6.2 - Payout Policy and Taxation 93


1

, Part 6.3 - Payout vs Retention of Cash 96
Part 6.4 - Signalling with Payout Policy 98

Week 4 - Lecture 7 - Risk Management 101
Part 7.1 - Risk Management 101
Part 7.2 - Insurance 103
Part 7.3 - Hedging input price risk 105
Part 7.4 - Interest rate risk 106

Week 4 - Lecture 8 - Short-term Financial Planning 111
Part 8.1 - Working Capital Management 111
Part 8.2 - NWC component management 112
Part 8.3 - Cash and credit constraints 115
Part 8.4 - The Matching Principle 116

Week 5 - Lecture 9 & 10 - Issuance 118
Lecture 9/10.1 - Equity Issuance 118
Lecture 9/10.2 - IPO 123
Lecture 9/10.3 - IPO Puzzles 126
Lecture 9/10.4 - Venture capital 131
Lecture 9/10.5 - Debt issuance 134

Week 6 - Guest Lectures 138
Part 1 - Tuesday - Securitization 138
Part 2 146




2

,Week 1 - Lecture 1 - Value creation, financial statements, and from FS to CFs

Part 1 - Value creation
When does a project create value?




NPV > 0 → project creates value
NPV < 0 → project destroys
NPV = 0 → neither creation nor destruction of value

Economic Value Added (EVA) = that attempts to measure the true economic profit
produced by a company.
Market Value Added (MVA) = is simply the difference between the current total market
value of a company and the capital contributed by investors (including both shareholders
and bondholders). It is typically used for companies that are larger and publicly-traded.




In this example:
Project A:
MVA (Market Value Added) = 10 (value you get on the market with r)
EVA (Economic Value Added)= 11/1+r (value you get when investing)

NPV = -100 + 121/1.1 = +10



Market Value balance sheet: 110 = market value of assets
Book Value balance sheet: 100 = book value of assets


3

, Investors often look at the market-to-book value.

Project B: the share price will go down
You can have profitable projects but you still should not invest in it.
Only invest in projects which have a positive NPV.


Part 2 - Investment in Growth (MVA and EVA)
Market Value Added (MVA) and Economic Value Added (EVA)
Some other numerical examples (ignore taxes)
Value = Present value of the expected Free Cash Flows
Value = PV E(FCF)
The FCF is the CF that you can pay out each year to the providers of capital.

Special case: Value0 = FCF1 / (WACC – g)
The CF will never end so it is a perpetual.




Because of a ROI of 20%, the EBIT in year 1 is 100 (500 x 20%).
EVA year 1 = 100 - 0.12 + 500
MVA 0 = EVA1 / (WACC - g) = 40 / (0.12-0.05) = 571,43

ROIC = EBIT / Invested Capital = = 20%
Growth = ROIC x (Net investment / EBIT) = 20% x 25% = 5%

EBIT = Earnings before interest and taxes
Invested capital = Operating working capital + Net property, plant, and equipment + Other
assets

Question: What if the investment rate* is 40% instead of 25%?
What happens with the growth rate? → increases
What happens with the FCF in year 1? → decreases
What happens with the value of the firm?

* Investment rate = Net investment / EBIT




4

Voordelen van het kopen van samenvattingen bij Stuvia op een rij:

Verzekerd van kwaliteit door reviews

Verzekerd van kwaliteit door reviews

Stuvia-klanten hebben meer dan 700.000 samenvattingen beoordeeld. Zo weet je zeker dat je de beste documenten koopt!

Snel en makkelijk kopen

Snel en makkelijk kopen

Je betaalt supersnel en eenmalig met iDeal, creditcard of Stuvia-tegoed voor de samenvatting. Zonder lidmaatschap.

Focus op de essentie

Focus op de essentie

Samenvattingen worden geschreven voor en door anderen. Daarom zijn de samenvattingen altijd betrouwbaar en actueel. Zo kom je snel tot de kern!

Veelgestelde vragen

Wat krijg ik als ik dit document koop?

Je krijgt een PDF, die direct beschikbaar is na je aankoop. Het gekochte document is altijd, overal en oneindig toegankelijk via je profiel.

Tevredenheidsgarantie: hoe werkt dat?

Onze tevredenheidsgarantie zorgt ervoor dat je altijd een studiedocument vindt dat goed bij je past. Je vult een formulier in en onze klantenservice regelt de rest.

Van wie koop ik deze samenvatting?

Stuvia is een marktplaats, je koop dit document dus niet van ons, maar van verkoper SophievA. Stuvia faciliteert de betaling aan de verkoper.

Zit ik meteen vast aan een abonnement?

Nee, je koopt alleen deze samenvatting voor €5,49. Je zit daarna nergens aan vast.

Is Stuvia te vertrouwen?

4,6 sterren op Google & Trustpilot (+1000 reviews)

Afgelopen 30 dagen zijn er 70055 samenvattingen verkocht

Opgericht in 2010, al 14 jaar dé plek om samenvattingen te kopen

Start met verkopen
€5,49  1x  verkocht
  • (0)
  Kopen