Company Research Project/Individual Case Study Analysis

Complete the required assignments accompanying the attached case studies (click on the case titles to access case materials) and submit one completed assignment. Your submission should be made of two files:

1. Excel worksheet with all your calculations performed using appropriate excel functions (DO NOT simply type in your answers into the Excel file. You will not receive any points for the answers if you do so). Use a different tab on the Excel worksheet for each sub-question on the assignment and label the tabs appropriately (e.g. Case_28_Q1 or Case_27_Q2b)
2. A Word file with the appropriate text explanations that refer to the appropriate section(s) of the Excel file.

Case 14: Baines Investment, Inc. - Stock Valuation

The case focuses on the use of the capital asset pricing model (CAPM) in valuing stock, and on the issue of determining a beta for a privately held company. It also illustrates the use of a liquidity discount for a non-public company and provides opportunities for computing the P/E ratio under different scenarios.

Case 15: Atlantic Airlines - Bond Valuation

The case is focuses on bond valuation. The topic of junk bonds is introduced and becomes the central focus of the discussion and the calculations. You are asked to consider whether the higher yield on the bonds is adequate to cover potential downside exposure

Case 16: Berkshire Instruments - Cost of Capital

The case gives you additional opportunities to work with issues related to cost of capital. It focuses on the irrelevance of historical cost and the close relationship of retained earnings and new common stock in supplying equity capital. The concept of the marginal cost of capital is heavily stressed, and the use of the capital asset pricing model as an alternative to computing the cost of equity capital is also introduced.