{"id":109490,"date":"2022-12-10T12:50:41","date_gmt":"2022-12-10T12:50:41","guid":{"rendered":"https:\/\/assignmenttutors.net\/blog\/final-project-fin4502-fin4502-florida-international-university-modesto-a-maidique-campus\/"},"modified":"2022-12-10T12:50:41","modified_gmt":"2022-12-10T12:50:41","slug":"final-project-fin4502-fin4502-florida-international-university-modesto-a-maidique-campus","status":"publish","type":"post","link":"https:\/\/assignmenttutors.net\/blog\/final-project-fin4502-fin4502-florida-international-university-modesto-a-maidique-campus\/","title":{"rendered":"Final project fin4502 | FIN4502 | Florida International University, Modesto A. Maidique Campus"},"content":{"rendered":"
\n

\u00a0The goal of this project is to estimate the value loss or creation resulting from COVID-19 for a firm of
your choice. \u00a0\u00a0<\/p>\n

\u00a0<\/p>\n

you can dismiss the DDM and PE valuation methods in the Quantitative portion. \u00a0
I strongly suggest that you start working on this project as early as possible.
Qualitative Research (Before COVID-19 crisis):
\uf0b7 You should include a qualitative analysis where you describe: \u00a0
o The overall situation of the firm and trajectory
o The financial situation of the firm
o The prospects for growth and future plans
\uf0b7 Please include a brief SWOT Analysis
\uf0b7 Detail the reasons supporting your chosen \u201csuper-normal growth rate\u201d. You should also justify
your \u00a0chosen \u00a0time-horizon of this \u201csuper-normal \u00a0growth\u201d stage of the \u00a0business \u00a0cycle \u00a0of \u00a0the
firm (how long the firm will grow at this super normal rate before using the long term growth
rate)
\uf0b7 The qualitative analysis must be at least 2 pages (single-spaced and typed). In addition to the
2 pages, you should \u00a0explain the rationale behind your choice for all needed assumptions in
your valuations.
Quantitative Research (Before vs. After COVID-19 crisis): \u00a0
\uf0b7 A: Estimate the value of your firm using three valuation methods (DDM, PE and DCF) before
the COVID-19 shock (As of January 2020). \u00a0
\uf0b7 B: Estimate the value of your firm using three valuation methods (DDM, PE and DCF) after the
COVID-19 shock (As of April 2020). (Hint for DDM: Has the firm announced any changes to the
forthcoming dividends?)
***Before choosing a firm, please make sure that the company is profitable (is having positive
earnings) and that it has paid dividends for at least three years. \u00a0
***If you are working on the project by yourself, you can dismiss the DDM and PE valuation
models. \u00a0
\uf0b7 The value \u00a0loss or creation is simply \u00a0the \u00a0difference \u00a0between A and B for each model. \u00a0Please
answer the question: In your opinion, which valuation method captured the value loss\/gain
more precisely and why do you think this is the case?
\uf0b7 You should submit your quantitative \u00a0research in an Excel Workbook. \u00a0All calculations should
be made by formulas. Any number plugged-in manually will be ignored for grading purposes. \u00a0
\uf0b7 Your assumptions, of course, are the result of your qualitative research. Although these values
may be plugged directly (there is no formula), you should describe how you chose the \u201cx\u201d or
\u201cy\u201d value as your assumption in the qualitative portion.<\/p>\n

\uf0b7 For calculation of Beta, your historical observation period will be 2017 \u2013 2019 (3-Year Period).
Use monthly returns.
\uf0b7 Remember that the discount rate used in the DDM method is the Expected Return estimated
from the Capital Asset Pricing Model.
\uf0b7 It is understood that an accurate estimation of a firm\u2019s value loss or gain due to COVID-19 is
a laborious and complex process which requires data that is not in your reach or possibly not
yet available. Attempting to do so is out of the reach of this project. Notwithstanding, you
should be ok implementing the basic form of DDM, PE and DCF models as learned in this class.
If you face any challenges or limitations, please reach out to your instructor. \u00a0
\uf0b7 You will not be graded by the accuracy of your valuation, data, inputs or output, but rather by
correctly implementing the models learned in class.<\/p>\n

Remarks:
* You must show your calculations for Beta. Remember to use 36 months. You can vary this timeframe
providing the reasons to do so. \u00a0
* In this project, you \u00a0should consider the 10-year Treasury \u00a0rate as the \u201crisk-free\u201d rate. You can find
this rate at: https:\/\/fred.stlouisfed.org\/series\/DGS10. The risk-free rate will be quite different before
and after COVID-19 ….. Just as food for thought: Pay attention to the effect of this rate in your cost of
equity and cost of capital. \u00a0
* Assume S&P500 returns as the \u201cmarket returns\u201d. You can get the index prices from Yahoo Finance
(https:\/\/finance.yahoo.com\/quote\/%5EGSPC\/history\/). Remember to use the Adjusted Close column.
Please keep in mind these are the prices. For your valuation, you will need the returns (Pt+1 \/ Pt \u2013 1).
* \u00a0When calculating your firm\u2019s WACC \u00a0(In \u00a0the \u00a0Discounted \u00a0Cash \u00a0Flow \u00a0Model), \u00a0you \u00a0do \u00a0not \u00a0need \u00a0to
calculate the cost of debt. You can find it online and cite your source.
* Please indicate your sources for all data used in your valuation. \u00a0
* \u00a0You \u00a0may \u00a0find \u00a0data \u00a0for \u00a0Quarterly \u00a0Dividends. \u00a0However, \u00a0please \u00a0remember \u00a0to \u00a0use \u00a0the \u00a0total \u00a0yearly \u00a0Dividends when estimating the stock value using DDM (Dividend Discount Model).\u00a0<\/p>\n

\u00a0<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

\u00a0The goal of this project is to estimate the value loss or creation resulting from COVID-19 for a firm ofyour choice. \u00a0\u00a0 \u00a0 you can dismiss the DDM and PE valuation methods in the Quantitative portion. \u00a0I strongly suggest that you start working on this project as early as possible.Qualitative Research (Before COVID-19 crisis):\uf0b7 You […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[16],"tags":[],"class_list":["post-109490","post","type-post","status-publish","format-standard","hentry","category-education"],"_links":{"self":[{"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/posts\/109490","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/comments?post=109490"}],"version-history":[{"count":0,"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/posts\/109490\/revisions"}],"wp:attachment":[{"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/media?parent=109490"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/categories?post=109490"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/assignmenttutors.net\/blog\/wp-json\/wp\/v2\/tags?post=109490"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}