Financial Engineering to Enhance Shareholder Value
pptx
keyboard_arrow_up
School
University of Nairobi School of Physical Sciences *
*We aren’t endorsed by this school
Course
DFA 101
Subject
Finance
Date
Nov 24, 2024
Type
pptx
Pages
11
Uploaded by OBMAXIM
Financial Engineering to
Enhance Shareholder Value for
ABC Healthcare Corporation
Student’s Name
Institutional Affiliation
Course Number
November 06, 2022
Summary – Financial Condition
Analysis
•
An overall financial analysis of ABC Corporation
•
Analyzing financial ratios and their significance for ABC Healthcare Corp.
•
Commenting on the trend analysis of the company based on analysis of
financial ratios
•
Comparing company’s financial performance to competitors
•
Recommendation of strategies to maximize shareholder value
•
Summary
•
Identification of tactics that would increase the value to stakeholders.
•
Provide business decision insights and determined ABC's overall financial health.
Summary – Evaluation of Capital
Projects
•
Discussion of various methods of capital evaluation
•
Evaluating different options presented and comparing their merits.
•
Deciding in the best project and recommending possible decisions to
be made.
•
Summary
•
To comprehend capital budgeting techniques used to analyze proposed
investment projects.
•
suggestion of the most beneficial investment undertaking which will yield the
greatest return for the business.
Your preview ends here
Eager to read complete document? Join bartleby learn and gain access to the full version
- Access to all documents
- Unlimited textbook solutions
- 24/7 expert homework help
Current Financial Condition
•
ABC Health isn't competitive by industry standards.
•
If we compare ABC Healthcare to HCA Healthcare, we see that it, too,
is underperforming the market.
•
Price-to-earnings and price-to-book ratios, for example, both pointed
in the right direction.
•
ABC Healthcare Corporation is undervalued and should follow the
financial analysis's suggestions.
Overview of Analysis – Trend
Analysis
•
The team learned from a trend analysis what they can do now to
improve their performance in the future.
•
The price-to-earnings ratio chart makes it obvious that the market
value won't change.
•
If earnings per share go down, the price-to-earnings ratio goes up.
•
As the price-to-book ratio rises, it measures how much equity
shareholders will pay for a company's net assets.
Data Used
Price/Ratio
2019
2018
2017
Market Price
83.62
83.62
83.62
Earnings per share
6.91
7.87
9.15
Price/earnings ratio
12.10
10.63
9.14
Your preview ends here
Eager to read complete document? Join bartleby learn and gain access to the full version
- Access to all documents
- Unlimited textbook solutions
- 24/7 expert homework help
Data Used
Price/Ratio
2019
2018
2017
Market price
83.62
83.62
83.62
Book value per share
199.1
209.05
226
Price-to-book ratio
0.42
0.40
.37
Recommendation to Maximize
Shareholder Value
•
Increasing short-term profitability by reducing costs is simple.
•
Unnecessary testing and better customer service can cut costs.
•
Investors may see debt repayment favorably if it frees up capital for
revenue growth.
•
Paying dividends is a short-term advice that will refund investors'
money.
•
Dividends raise share value and can benefit a company long-term.
Tactical Objectives
•
Carry only assets that maximize value.
•
First, value-oriented organizations assess whether purchasers are ready to
pay a considerable premium above their anticipated cash flow value for
business units, brands, real estate, and other detachable assets.
•
When there are no value-creating investments, return cash to
shareholders.
•
This can be done while we have no upcoming investments, reducing the
danger of bad financial judgments.
•
Reward middle managers and frontline workers for performing well
on key value drivers they affect.
Your preview ends here
Eager to read complete document? Join bartleby learn and gain access to the full version
- Access to all documents
- Unlimited textbook solutions
- 24/7 expert homework help
Financial Tools
•
Financial Statements
•
Provides updates on the company's financial
position, performance, and changes.
•
Financial KPI’s
•
Profitability, liquidity, solvency, efficiency, and
valuation
References
•
Hayes, A. (2021, May 19). Book value per share (bvps) definition.
Investopedia.
https://www.investopedia.com/terms/b/bvps.asp
.
•
Rappaport, A. (2014, August 1). Ten ways to create shareholder value.
Harvard Business Review. https://hbr.org/2006/09/ten-ways-to
create-shareholder-value.
Related Documents
Related Questions
Analysis of Corporate Governance and Sustainability Report of Rio Tinto please write me based on following criteria
Objective: This research-based individual work aims to provide an analysis of a top 200 AGX listed company's latest (2023) about Rio Tinto Corporate Governance Report and Sustainability Report. In the absence of a Sustainability and Corporate Governance Report, the Company's Annual Report (2023) or Website Report can be used. The assignment requires critical evaluation of the company's corporate governance mechanisms and sustainability/CSR activities during and after the COVID-19 pandemic. The analysis must incorporate theoretical and practical implications of accounting on these COVID-19-related responses.
Specific Requirements need to be answered:
A brief background of the selected company's Corporate Governance and Corporate Social Responsibility (CSR)/sustainability policy and strategy. [ max-2 pages]
Critical evaluation of the company's corporate governance…
arrow_forward
Please correct answer and don't use hand rating
arrow_forward
Answer it precisely and clear format
arrow_forward
GP
You
Write a post providing us with the context for the resources of adopting innovative technologies that can lead to streamlined processes, real-time insights, and increased focus on strategic planning technological advancements in the accounting and finance profession have required finance professionals to adapt and expand their skill sets. Those who can adapt can support business growth and discover better career opportunities selected by identifying the field of study of accounting and finance and specifying an associated profession if relevant. Explain in two separate sections how this could be applied to the criteria of validity checklist to determine the validity of each resource. Try to be as thorough as possible with the questions listed under each heading on the checklist. If unable to make a determination about any of the criteria, be sure to explain that, too.
arrow_forward
None
arrow_forward
3
Choose a public-listed company that applies Balanced Scorecards (BSC) as a form of performance evaluation system. Critically evaluate its financial (specifically, 4
selected items from the stock investment analysis) and non-financial performance of the latest one-year period based on FOUR (4) perspectives of BSC.
(Hint: use your personal but rational judgement to determine possible Key Performance Index (KPI) of this company before performance the BSC analysis).
Edit View Insert Format
Tools
Table
良
arrow_forward
About this Assignment
For this Corporate Finance 301 assignment, you will submit a research paper that analyzes the types of organizational business
structures. You will apply knowledge of business structure concepts as acquired in the course. The research paper should follow APA
formatting style.
Project Prompts
The written research paper should be at least 1,000 to 1,200 words in length and should include four sections based on the business
structures studied throughout the course. Define each business structure, compare the corporate finance strategies of the four business
structures, discuss the advantages and disadvantages of each business structure, and how each varies in taxation.
Research Paper Sections
⚫ Sole Proprietorship
⚫ Partnership
• Corporation
⚫ Limited Liability Company (LLC)
arrow_forward
Management accounting has the following features:
Select one:
O A. Future orientated focus
O B. Stewardship orientation focus
O C. Focus on detailed annual reports
O D. Focus on decision-making needs of shareholders
arrow_forward
Strategy
The table below contains the names of six companies.
Required:
For each company, categorize its strategy as being focused on customer intimacy, operational excellence, or product leadership, if you wish to improve your understanding of each company’s customer value proposition before completing the exercise, review its most recent annual report. To obtain electronic access to this information, perform an Internet search on each company’s name followed by the words “annual report.”
arrow_forward
Finance 500
In this assignment, the purpose is to tie into the key concepts and insights studied this term in this course. Reflecting on key principles, strategies, or tactics that were covered from the accounting and finance fields, students should relate the information to their career, company or industry of interest.
Demonstrate how the knowledge, skills, or theories of this course have been applied, or could be applied, in a practical manner to your current work environment (a project manager in design industry).
Share a personal connection that identifies specific knowledge and theories from this course.
Demonstrate a connection to your current work environment.
You should NOT, provide an overview of the assignments assigned in the course. The assignment asks that you reflect how the knowledge and skills obtained through meeting course objectives were applied or could be applied in the workplace.
arrow_forward
aims to identify, record, and communicate information about
business activities. It helps assess opportunities, products,
investments, and social and community responsibilities.
Users of accounting are both internal and external. Some
users and uses of accounting include (a) managers in
controlling, monitoring, and planning; (b) lenders for
measuring the risk and return of loans; (c) shareholders for
assessing the return and risk of stock; and (d) employees for
judging employment opportunities. Opportunities in
accounting include financial, managerial, and tax accounting.
Csuterstack/Fory burrow
OGlow Asia/Saperstock
130s
:00/ 0:58
1x
CC
Knowledge Check 01
Match the term and the definition.
Definition
The recording of transactions and events only, either manually or electronically.
An information and measurement system that identifies, records, and communicates relevant,
reliable, and comparable information about an organization's business activities.
arrow_forward
Assignment Specifications Part A The corporate disclosure practice will help all the stakeholders to understand and measure business operation. Annual financial statement and particularly income statement is one of the most important ones. However, a company's reported profits will be impacted by different factors, including when particular transactions and events are recognised and how such transactions and events are measured. Requirement: 1) Using earning management concept, discuss why the timing of recognising events that impact income, revenue or profit or expenses are important for managers?
"Maximum 1000 words."
Part B
ABC Ltd has incorporated a bonus plan that rewards the board of directors (executive members) by providing a bonus of 3 per cent of reported profits. This is an Accounting-based incentive that has the advantage which the accounting results may be based on subunit or divisional performance. "A well-informed labour market will motivate management to work to…
arrow_forward
Assignment Specifications
The corporate disclosure practice will help all the stakeholders to understand and measure business operation. Annual financial statement and particularly income statement is one of the most important ones. However, a company's reported profits will be impacted by different factors, including when particular transactions and events are recognised and how such transactions and events are measured.
Requirement:1) Using earning management concept, discuss why the timing of recognising events that impact
income, revenue or profit or expenses are important for managers?
"Maximum 1000 words."
arrow_forward
Task Two
Define the following terms: 'stakeholder'; 'shareholder' and 'stakeholder analysis'.
Using a named real company of your choice, demonstrate how you would apply the
stakeholder analysis process to identify the company's stakeholder groups and
evaluate their needs and influence.
arrow_forward
Discussion Thread: Valuation Factors.
discuss the factors that lead to a valuation of a company’s worth compared to that of the financial statements and how company executives create the most value for all stakeholders.
arrow_forward
Part AThe corporate disclosure practice will help all the stakeholders to understand and measure businessoperation. Annual financial statement and particularly income statement is one of the most important ones.However, a company's reported profits will be impacted by different factors, including when particulartransactions and events are recognised and how such transactions and events are measured.Requirement:1) Using earning management concept, discuss why the timing of recognising events that impactincome, revenue or profit or expenses are important for managers?"Maximum 1000 words."Part BABC Ltd has incorporated a bonus plan that rewards the board of directors (executive members) by providinga bonus of 3 per cent of reported profits. This is an Accounting-based incentive that has the advantage whichthe accounting results may be based on subunit or divisional performance."A well-informed labour market will motivate management to work to maximise the value of its…
arrow_forward
SEE MORE QUESTIONS
Recommended textbooks for you
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:9781337679503
Author:Gilbertson
Publisher:Cengage

Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub

Financial Reporting, Financial Statement Analysis...
Finance
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:Cengage Learning
Related Questions
- Analysis of Corporate Governance and Sustainability Report of Rio Tinto please write me based on following criteria Objective: This research-based individual work aims to provide an analysis of a top 200 AGX listed company's latest (2023) about Rio Tinto Corporate Governance Report and Sustainability Report. In the absence of a Sustainability and Corporate Governance Report, the Company's Annual Report (2023) or Website Report can be used. The assignment requires critical evaluation of the company's corporate governance mechanisms and sustainability/CSR activities during and after the COVID-19 pandemic. The analysis must incorporate theoretical and practical implications of accounting on these COVID-19-related responses. Specific Requirements need to be answered: A brief background of the selected company's Corporate Governance and Corporate Social Responsibility (CSR)/sustainability policy and strategy. [ max-2 pages] Critical evaluation of the company's corporate governance…arrow_forwardPlease correct answer and don't use hand ratingarrow_forwardAnswer it precisely and clear formatarrow_forward
- GP You Write a post providing us with the context for the resources of adopting innovative technologies that can lead to streamlined processes, real-time insights, and increased focus on strategic planning technological advancements in the accounting and finance profession have required finance professionals to adapt and expand their skill sets. Those who can adapt can support business growth and discover better career opportunities selected by identifying the field of study of accounting and finance and specifying an associated profession if relevant. Explain in two separate sections how this could be applied to the criteria of validity checklist to determine the validity of each resource. Try to be as thorough as possible with the questions listed under each heading on the checklist. If unable to make a determination about any of the criteria, be sure to explain that, too.arrow_forwardNonearrow_forward3 Choose a public-listed company that applies Balanced Scorecards (BSC) as a form of performance evaluation system. Critically evaluate its financial (specifically, 4 selected items from the stock investment analysis) and non-financial performance of the latest one-year period based on FOUR (4) perspectives of BSC. (Hint: use your personal but rational judgement to determine possible Key Performance Index (KPI) of this company before performance the BSC analysis). Edit View Insert Format Tools Table 良arrow_forward
- About this Assignment For this Corporate Finance 301 assignment, you will submit a research paper that analyzes the types of organizational business structures. You will apply knowledge of business structure concepts as acquired in the course. The research paper should follow APA formatting style. Project Prompts The written research paper should be at least 1,000 to 1,200 words in length and should include four sections based on the business structures studied throughout the course. Define each business structure, compare the corporate finance strategies of the four business structures, discuss the advantages and disadvantages of each business structure, and how each varies in taxation. Research Paper Sections ⚫ Sole Proprietorship ⚫ Partnership • Corporation ⚫ Limited Liability Company (LLC)arrow_forwardManagement accounting has the following features: Select one: O A. Future orientated focus O B. Stewardship orientation focus O C. Focus on detailed annual reports O D. Focus on decision-making needs of shareholdersarrow_forwardStrategy The table below contains the names of six companies. Required: For each company, categorize its strategy as being focused on customer intimacy, operational excellence, or product leadership, if you wish to improve your understanding of each company’s customer value proposition before completing the exercise, review its most recent annual report. To obtain electronic access to this information, perform an Internet search on each company’s name followed by the words “annual report.”arrow_forward
- Finance 500 In this assignment, the purpose is to tie into the key concepts and insights studied this term in this course. Reflecting on key principles, strategies, or tactics that were covered from the accounting and finance fields, students should relate the information to their career, company or industry of interest. Demonstrate how the knowledge, skills, or theories of this course have been applied, or could be applied, in a practical manner to your current work environment (a project manager in design industry). Share a personal connection that identifies specific knowledge and theories from this course. Demonstrate a connection to your current work environment. You should NOT, provide an overview of the assignments assigned in the course. The assignment asks that you reflect how the knowledge and skills obtained through meeting course objectives were applied or could be applied in the workplace.arrow_forwardaims to identify, record, and communicate information about business activities. It helps assess opportunities, products, investments, and social and community responsibilities. Users of accounting are both internal and external. Some users and uses of accounting include (a) managers in controlling, monitoring, and planning; (b) lenders for measuring the risk and return of loans; (c) shareholders for assessing the return and risk of stock; and (d) employees for judging employment opportunities. Opportunities in accounting include financial, managerial, and tax accounting. Csuterstack/Fory burrow OGlow Asia/Saperstock 130s :00/ 0:58 1x CC Knowledge Check 01 Match the term and the definition. Definition The recording of transactions and events only, either manually or electronically. An information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization's business activities.arrow_forwardAssignment Specifications Part A The corporate disclosure practice will help all the stakeholders to understand and measure business operation. Annual financial statement and particularly income statement is one of the most important ones. However, a company's reported profits will be impacted by different factors, including when particular transactions and events are recognised and how such transactions and events are measured. Requirement: 1) Using earning management concept, discuss why the timing of recognising events that impact income, revenue or profit or expenses are important for managers? "Maximum 1000 words." Part B ABC Ltd has incorporated a bonus plan that rewards the board of directors (executive members) by providing a bonus of 3 per cent of reported profits. This is an Accounting-based incentive that has the advantage which the accounting results may be based on subunit or divisional performance. "A well-informed labour market will motivate management to work to…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
- Century 21 Accounting Multicolumn JournalAccountingISBN:9781337679503Author:GilbertsonPublisher:CengageManagerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College Pub
- Financial Reporting, Financial Statement Analysis...FinanceISBN:9781285190907Author:James M. Wahlen, Stephen P. Baginski, Mark BradshawPublisher:Cengage Learning
Century 21 Accounting Multicolumn Journal
Accounting
ISBN:9781337679503
Author:Gilbertson
Publisher:Cengage

Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub

Financial Reporting, Financial Statement Analysis...
Finance
ISBN:9781285190907
Author:James M. Wahlen, Stephen P. Baginski, Mark Bradshaw
Publisher:Cengage Learning