model.xls

The question that is being asked relates not just to,,, ,the existing differential advantage but also to the future.,,, ,,, ,"If the earnings are negative, please enter the following:",,, ,Are the earnings negative because the firm is in a cyclical business ,,,(Yes or No) ,Are the earnings negative because of a one-time or temporary occurrence ,,,(Yes or No) ,Are the earnings negative because the firm has too much debt ,,,(Yes or No) ,"If yes, is there a strong likelihood of bankruptcy ",,(Yes or No) ,Are the earnings negative because the firm is just starting up ,,,(Yes or No) ,Financial Leverage,,, ,What is the current debt ratio (in market value terms) ,,4 ,(in percent) ,Is this debt ratio expected to change significantly ,,Yes,(Yes or No) ,,, ,Dividend Policy,,, ,What did the firm pay out as dividends in the current year ,,100,(in currency) ,Can you estimate capital expenditures and working capital requirements ,,Yes,(Yes or No) ,Enter the following inputs (from the current year) for computing FCFE,,, ,Net Income (NI),,200, ,Depreciation and Amortization,,50, ,Capital Spending (Including acquisitions),,100, , Non-cash Working Capital ( WC),,25, ,,, ,FCFE = NI - (Capital Spending - Depreciation) (1- Debt Ratio) - WC (1-Debt Ratio) =,,,128 ,,, ,OUTPUT FROM THE MODEL,,, ,"Based upon the inputs you have entered, the right valuation model for this firm is:",,, ,"Type of Model (DCF Model, Option Pricing Model):",,Discounted CF Model," If option pricing model, first do a DCF valuation" ,"Level of Earnings to use in model (Current, Normalized):",,Current Earnings, ,"Cashflows that should be discounted (Dividends, FCFE, FCFF) :",,FCFF (Value firm), ,"Length of Growth Period (10 or more, 5 to 10, less than 5)",,10 or more years, ,"Appropriate Growth Pattern (Stable, 2 stage, 3 stage):",,Three-stage Growth," In an n-stage model, you will estimate target operating margins (if valuing the firm)" ,,,or net