Financial Management Case Study

Question 2 Assumptions and explanations: 1. All numbers argon in Millions of Dollars, unless differently specified 2. Where given data for beginning of 2010 is necessary data from suppress of 2009 will be utilise. 3. Sales for 2010 and 2011 ar taken from Intel estimation. 2012- 2019 yearly sales 3.5% harvest-home rate is estimated, based on growth rate average of 2000-2011. 4. Operating income for 2010-2019 is come divulge to be 38.1% (average 2000-2011) of Sales. 5. wear and tear for 2010-2019 is correct to be 12.8% (average 2000-2011) of Sales. 6. assess 2010-2019 is 30% fasten ond to be the same as in 2010-2010. 7. with child(p) disbursal for 2010is set to be 15.1% (average 2000-2011) of Sales. We assume that in the pertinacious end point Capital expenditure and depreciation should be similar, since in the long term the company will assign in order to book its assets. We modeled the Capital Expenditure to drop linearly from 2010. In 2019 Capital expenditure is equalise Intels estimated depreciation. 8. Working Capital for 2010-2019 is set to be 29.7% (average 2000-2011) of Sales. Investment in working capital is the establish in WC between twain sequential years. 9. Discounted cash break away after 2020 is cypher using constantly growing sempiternity formula : NPV = [PMT1/(r-g) ] /[(1+r)^10] Where: PMT=PMT2020= 10,271.

7 r=COC=12% g=3%, We assume great term growth rate should equal the gross home(prenominal) product growth of approximately 3%. Final results: 1. FCF for 2010-2019 are presented in the excel file 2. Intels continuation value is 34.583 millions $ 3. PV of FCF is 75.992Billions $ 4. bestow Valu! e is 75.992Billions $ (PV + 3Billion $ of non used cash) 5. Equity= V-D =83.178 Billions $ 6. Value per share is good Value (83.178 Billions $) / # of Shares (5523)=15.06$ per share The effective adjusted market monetary value of Intel share on 5,Jan,2010 was 20.40 Billion $. 7. The difference between our metrical share value and the factual market value whitethorn derive from any luxate in...If you want to get a full essay, order it on our website: OrderEssay.net

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