Forum Search: capital markets
Re: NPV
Yes, you are correct that if you include the original investment of $10, you would get NPV of $4.2. Our logic was to just take the NPV of future cash flows after the original investment. The logic by not including the $10: in the most traditional capital budgeting decision (invest or don't invest... Read More
Yes, you are correct that if you include the original investment of $10, you would get NPV of $4.2. Our logic was to just take the NPV of future cash flows after the original investment. The logic by not including the $10: in the most traditional capital budgeting decision (invest or don't invest... Read More
Re: Seasonal Working Capital
Is this in the context of an M&A and deciding working capital purchase price adjustments? If so, we would ask: When is this business being acquired - specifically when is deal closing? Is closing going to coincide at what part of the inventory build cycle? i.e. at the absolute low inventory (righ... Read More
Is this in the context of an M&A and deciding working capital purchase price adjustments? If so, we would ask: When is this business being acquired - specifically when is deal closing? Is closing going to coincide at what part of the inventory build cycle? i.e. at the absolute low inventory (righ... Read More
Seasonal Working Capital
How should a working capital target be chosen for a business that has seasonal net working capital (for example, every year a company must build up inventory and its suppliers do not take credit, or bonuses for employees are paid at the end of each fiscal year). From what I have seen, many practitio... Read More
How should a working capital target be chosen for a business that has seasonal net working capital (for example, every year a company must build up inventory and its suppliers do not take credit, or bonuses for employees are paid at the end of each fiscal year). From what I have seen, many practitio... Read More
Re: CapEx and capital lease
Yes, you are correct from a purely technical standpoint. However, keep in mind that such capital lease increases would be actually reflected in CFF, so the net impact is still properly reflected in the model. From an accounting debits and credits perceptive, capital lease liability on the BS would g... Read More
Yes, you are correct from a purely technical standpoint. However, keep in mind that such capital lease increases would be actually reflected in CFF, so the net impact is still properly reflected in the model. From an accounting debits and credits perceptive, capital lease liability on the BS would g... Read More
CapEx and capital lease
Shouldn't capital lease portion of CapEx be excluded from CFI calculation as capital lease by defination is funded by capital lease rather than cash?
Shouldn't capital lease portion of CapEx be excluded from CFI calculation as capital lease by defination is funded by capital lease rather than cash?
Re: FCFF (Unlevered Free Cash Flow)
You're thinking of free cash flow to equity (FCFE), which would include the effect of net borrowing/repayment of debt. Instead, we typically calculate FCFF, which is computed before any effects of capital structure.
You're thinking of free cash flow to equity (FCFE), which would include the effect of net borrowing/repayment of debt. Instead, we typically calculate FCFF, which is computed before any effects of capital structure.
FCFF (Unlevered Free Cash Flow)
Hi, when calculating unlevered free Cash Flow, we are deducting capex from the cash flow of the company, but net borrowing is not added. What if the company borrowed money to finance the capex? so for valuation purposes, for that year, FCFF will be negative. Is there a way to correct for it? Thanks... Read More
Hi, when calculating unlevered free Cash Flow, we are deducting capex from the cash flow of the company, but net borrowing is not added. What if the company borrowed money to finance the capex? so for valuation purposes, for that year, FCFF will be negative. Is there a way to correct for it? Thanks... Read More
Re:
Hi,
You can find this video under My Courses, in the "Overview of Financial Markets" package. Click on "Supplementary Video Exhibits" and the third video in the listing is "Share Repurchase."
Hi,
You can find this video under My Courses, in the "Overview of Financial Markets" package. Click on "Supplementary Video Exhibits" and the third video in the listing is "Share Repurchase."
"Share Repurchases" video online at www.wstselfstudy.com under FREE EXHIBITS
Hi
In the last Q&A you refer to the free "Share Repurchases" video online at www.wstselfstudy.com under FREE EXHIBITS to have a better understanding of the opportunity cost of funding Capital structure components. I can`t find the video. Could you please help? Thank you
Hi
In the last Q&A you refer to the free "Share Repurchases" video online at www.wstselfstudy.com under FREE EXHIBITS to have a better understanding of the opportunity cost of funding Capital structure components. I can`t find the video. Could you please help? Thank you
The classification of the convert would only have implications on debt to cap and related ratios. Generally speaking, if the accountants/auditors have blessed the 80/20 split on the BS, then that is the way to go. For building the debt sweep, MOST of the time, there is NO cash flow sweep required on... The classification of the convert would only have implications on debt to cap and related ratios. Generally speaking, if the accountants/auditors have blessed the 80/20 split on the BS, then that is the way to go. For building the debt sweep, MOST of the time, there is NO cash flow sweep required on CB since it’s all the way at the bottom of the capital structure, but this needs to be validated by the credit agreement. Likewise, any interest (cash interest or PIK) would typically accrue on the entire $1,000 balance. Typically, the only challenge is the decide the in-the-moneyness of the convert at exit, during the Enterprise Value to Equity Value calculation. Read More