Forum Search: capital markets
RE: AFM Enhancements: book value of equity to calc total capital
These ratios are standard ratios in a credit context, determined by the banks (lending institutions) and rating agencies. The idea here is that you are attempting to capture "liquidation value" of sorts and thus, book value is used not market value. The company doesn't actually receive market value ... Read More
These ratios are standard ratios in a credit context, determined by the banks (lending institutions) and rating agencies. The idea here is that you are attempting to capture "liquidation value" of sorts and thus, book value is used not market value. The company doesn't actually receive market value ... Read More
AFM Enhancements: Capitalization calculations
Hi there, I've got 2 doubts related to this module that you may be able to help me with: 1. Why our Total Capital calculation Line 18 does not include the Minority Interest figure? (once it is a source of capital as well) 2. Why are we considering the Capital Leases interest expense but not... Read More
Hi there, I've got 2 doubts related to this module that you may be able to help me with: 1. Why our Total Capital calculation Line 18 does not include the Minority Interest figure? (once it is a source of capital as well) 2. Why are we considering the Capital Leases interest expense but not... Read More
RE: AFM Enhancements: Capitalization calculations
1) In our Corporate Valuation online course we explain that Minority Interest is a source of capital for valuation purposes due to consolidation rules. However, for credit purposes, it is not a form of "actual" debt, which roughly is defined as interest-bearing, negotiated securities and so the bank... Read More
1) In our Corporate Valuation online course we explain that Minority Interest is a source of capital for valuation purposes due to consolidation rules. However, for credit purposes, it is not a form of "actual" debt, which roughly is defined as interest-bearing, negotiated securities and so the bank... Read More
Complex Trading Comps Analysis: Fair Value of Debt
Is it not more appropriate to use the fair Value of Debt (given in footnote 5 in F-15) versus the Book Value of Debt less Capital Leases Obligations as shown in the Video?
Thanks.
Is it not more appropriate to use the fair Value of Debt (given in footnote 5 in F-15) versus the Book Value of Debt less Capital Leases Obligations as shown in the Video?
Thanks.
RE: Complex Trading Comps Analysis: Convertibles of COSTCO
My first question is about COSTCO's convertibles. I was familiar with "if converted method" to measure the potential dilutive effects of potential dilution from CFA curriculum. The explanation given in the lecture was quite different. In the video, it was explained that whenever the face valu... Read More
My first question is about COSTCO's convertibles. I was familiar with "if converted method" to measure the potential dilutive effects of potential dilution from CFA curriculum. The explanation given in the lecture was quite different. In the video, it was explained that whenever the face valu... Read More
RE: Complex Trading Comps Analysis: Convertibles of COSTCO
1) Per the instruction in the video, it clearly stipulates that the key question in the costco converts rests on the timing - how long away is the maturity of the converts? if it matures tomorrow, the holder wouldn't convert b/c they can get more by simply holding to maturity and receiving par value... Read More
1) Per the instruction in the video, it clearly stipulates that the key question in the costco converts rests on the timing - how long away is the maturity of the converts? if it matures tomorrow, the holder wouldn't convert b/c they can get more by simply holding to maturity and receiving par value... Read More
RE: Complex Trading Comps Analysis: Weighs question
The weights for wacc in complex trading comps were estimated based on the target capital structure of the industry that is "normalized". If the weights are roughly the same as the actual, then it doesn't really matter which one to use. However, in a case of Costco, with no debt, one may want to sens... Read More
The weights for wacc in complex trading comps were estimated based on the target capital structure of the industry that is "normalized". If the weights are roughly the same as the actual, then it doesn't really matter which one to use. However, in a case of Costco, with no debt, one may want to sens... Read More
RE: Complex Trading Comps Analysis: Weighs question
Thank you fro the quick reply but this is not what i was looking for. In the wacc calculation of WMart in cells H21:H24 you have hard inputed some numbers. In cell K21 you have a D/E ratio of 20% which is derived from the division of cells H21/H23. My question id the following: If the target c... Read More
Thank you fro the quick reply but this is not what i was looking for. In the wacc calculation of WMart in cells H21:H24 you have hard inputed some numbers. In cell K21 you have a D/E ratio of 20% which is derived from the division of cells H21/H23. My question id the following: If the target c... Read More
RE: Complex Trading Comps Analysis: Weighs question
Don't forget that Debt / Capital is Debt / (Capital + Equity) and so it's just a matter of simple algebra. If D/E = 20%, then you can assume that D=20;E=100, then D/(D+E) is 20/120 or 1/6, hence 16.67%. As previously stated, the initial D/E assumption of 20% was assumed based on a combination of ind... Read More
Don't forget that Debt / Capital is Debt / (Capital + Equity) and so it's just a matter of simple algebra. If D/E = 20%, then you can assume that D=20;E=100, then D/(D+E) is 20/120 or 1/6, hence 16.67%. As previously stated, the initial D/E assumption of 20% was assumed based on a combination of ind... Read More
when you are calculating the total capital here, you are using the book value of equity to calculate, why we cann't use the market value of the equity, becuase that is more up-to-date.
thanks