Manipulate the WACC and long-term growth forecasting assumptions for Amazon on the chapter spreadsheet's Financial Analysis & Valuation worksheet (cells B147-F157). Use these modeling inputs to estimate the fair value of the stock as of year-end 2012 using a discounted free cash flow model. Write brief comments indicating whether Amazon appears under-, over-, or fairly-valued. Be sure to note how the forecasting assumptions you chose in Question 2 are affecting your estimate of Amazon's intrinsic value.
Answer to relevant Questionsa. Briefly define EVA and MVA. b. Describe both the level of and historical trend in Amazon’s EVA and MVA. c. Explain whether investors expect Amazon's and Costco's EVA to grow or decline based on the firm’s share ...Explain the basic idea behind the percent-of-sales method for forecasting companies' financial statements. What are some of the most effective ways firms defend their competitive position? Figure 7.23 shows the sector weights to a hypothetical portfolio vs. the sector weights of the S&P 500 index. Comment on whether the portfolio appears to be defensively or offensively positioned based on the portfolio ...Calculate the weighted average beta of the 50/50 and 35/35/30 portfolios.
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