Assume that you were recently hired as a Financial Advisor of a listed company on the London
Question:
Assume that you were recently hired as a Financial Advisor of a listed company on the London Stock Exchange and you were given the task of company and share valuation.
This assessment accounts for 80% of the module's total mark. It is an individual piece of work.
Task activity
Use a set of the most recent five years (e.g. 2019-2023 ) published annual reports in addition to the online published information on a non-financial company listed on the London Stock Exchange. Find the value of the company and its shares using appropriate valuation technique(s). Discuss critically whether the ESG performance of a company affects its value.
Your report should include the following:
- The rationale for the choice of the valuation technique(s).
- The sources of information and any assumptions you made.
- The company's cost of equity - comment on the differences in the estimates you obtained if you used alternative models.
- The company's weighted average cost of capital (WACC). Show all calculations concerning the cost of each source.
- A comparison between your calculated value with the current market price per share and the company market value.
- Advise on the appropriate investment decision by the company's shareholders and potential investors.
You should choose different companies from the ones you analyzed in the group assignments.
Guidelines
- The submission format is a business report so your submission must be structured accordingly.
- The word count limit is 3000words(+/-10%) including a brief introduction about the company and excluding your own relevant appendices (e.g. tables, calculations, other secondary materials).
- Do not include the full annual reports in the appendix.
- Your report can utilise information available from the web, you may also use Yahoo Finance and ft.com in addition to other web resources.
Expert Answer:
1 The rationale for the choice of the valuation techniques In this task I will choose the Discounted Cash Flow DCF and PricetoEarnings PE valuation te... View the full answer
