...Corporate Finance Lecture Note Packet 2 Capital Structure, Dividend Policy and Valuation B40.2302 Aswath Damodaran Aswath Damodaran! 1! Capital Structure: The Choices and the Trade off Neither a borrower nor a lender be Someone who obviously hated this part of corporate finance Aswath Damodaran! 2! First Principles Aswath Damodaran! 3! The Choices in Financing There are only two ways in which a business can make money. • The first is debt. The essence of debt is that you promise to make fixed payments in the future (interest payments and repaying principal). If you fail to make those payments, you lose control of your business. • The other is equity. With equity, you do get whatever cash flows are left over after you have made debt payments. Aswath Damodaran! 4! Global Patterns in Financing… Aswath Damodaran! 5! And a much greater dependence on bank loans outside the US… Aswath Damodaran! 6! Assessing the existing financing choices: Disney, Aracruz and Tata Chemicals Aswath Damodaran! 7! Financing Choices across the life cycle Revenues $ Revenues/ Earnings Earnings Time External funding needs High, but constrained by infrastructure High, relative to firm value. Moderate, relative to firm value. Declining, as a percent of firm value Low, as projects dry up. Internal financing Negative or low Owner’s Equity Bank...
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...Case One The Dilemma: Rose Partyware has been working towards creating its own brand of party ware supplies to give it a competitive edge in an industry of generic party supply manufacturers. Recently, Rose Partyware was presented with the opportunity to produce a private-label brand of party goods. This alternative would provide Rose with a stable revenue source as well as opportunities to create private-labels for other retailers. However, pursuing this option would drain Rose’s resources and prevent them from launching their own branded goods. Additionally private-labels would make Rose into a manufacturer-only role and limit its long-term prospects, but having its own brand is very costly to promote and comes with many short-term risks. Possible Solutions: 1. Proceed with Rose Partyware branded party supplies. * Retain loyalty of small independent retailers (35% of sales) * Brand advantage in party supplies versus other generic suppliers * Positive long-term returns * Control over pricing, branding, and distribution of goods * Short-term technological advantage 2. Pursue manufacturing private-label goods for retailers. * Retain largest Rose customer (20% of sales) * Supplier of choice in private-label manufacturing * Lowest short-term risk * Cheapest option in terms of change to company structure & spending The Decision: If I were in Tom Roses’ position I would choose to proceed with Rose Partyware branded party supplies...
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...Text, Film, and Historical Fact: Soucing “The Name of the Rose” 1. Evaluate the following statement: The film “The Name of the Rose” is an accurate portrayal of the lives of medieval monks. “The Name of The Rose” is a historical murder mystery combining fiction, biblical analysis, medieval studies and literary theory. The movie is very appropriate for historical class, because it simply describes the debate on the poverty of the clergy, but not converted beyond recognition. The scenes of the life in Abbey describe challenges and promises of monastic life. Such characters as dithering abbot and fat cellarer, quirky herbalist and dedicated illuminator demonstrate the variety of occupation and different personalities within the walls of the monastery. The scenes where after the second murder even the abbey became under the apprehension that they are experiencing the last days before the coming of Antichrist, is a perfect evidence that in the fourteen century many experienced divorce from the scholarly world turned to superstition, heretic movements, or apocalyptical outbursts. Moreover, the movie accurately described some parts of daily life medieval monks. The dining sessions, scenes of prayers, psalms and hymns were showed properly. Medieval monks devoted their lives to strict routine and discipline of life. For example, the part where elderly blind monk was angry at other monks because they were laughing claiming that monks never fool themselves. In the movie there...
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...Strangeworth is a “sweet” old woman who spends her time tending to the roses planted in front of her house. Like many people we meet today, the face we think we see on the outside isn’t always what it seems to be. In The Possibility of Evil Shirley Jackson uses symbolism to show the main character’s background and her motives. In the beginning of the story Mrs. Strangeworth’s roses represent her connection to her family who has passed away. On page on Mrs. Strangeworth says, “My family lived here for better than one hundred years. My grandmother planted these roses…” Mrs. Strangeworth’s roses were first planted by her grandmother, so she feels like the roses are a piece of her grandmother that she left behind when she passed away. The roses symbolize how long the Strangeworth family has lived in the town and how loved they were. Later on the story comments, “Mrs. Strangeworth never gave away any of her roses… they belonged on Pleasant Street.” Mrs. Strangeworth couldn’t imagine her grandmother’s roses being taken to another strange place. Her family had lived in that house on Pleasant street for years, that is where she thought the roses belonged, where her grandma had originally planted them. Mrs. Strangeworth’s roses personify her family ties however the symbolism of these roses change throughout the story....
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...Society Both Fences and the Piano Lesson are written by August Wilson during the 1980’s.The plays depict how women were supposed to be obedient to men and how they are not a woman if they are not married. Rose from Fences and Bernice from the Piano Lesson were similar to the idea that women are supposed to be obedient to men and how they are not a woman if they are not married or even do what men do. Fences,is about Rose and Troy and their son Cory. They built a fence around the house.The fence means something for both Rose and Troy, for Rose it means protection for her family and for Troy it means to keep stuff out. Rose is a woman is who brave and has a desire for respect. For example, when Troy does or say something that is inappropriate, Rose tells Troy why he is wrong.Troy...
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...the meaning, Panthera Leo: “large gregarious predatory feline of Africa and India having a tawny coat with a shaggy mane in the male” c. leopards, cougars, panthers, ocelots, and anything feline basically d. My scientific name would honestly be the same as it is now, if I was the one to name it I would probably think of something different at the time. But I have been associating leo with lion too long to think of any other name that doesn’t sound ridiculous. 2. a. Panthera Tigris, The full classification for a tiger would be: Kingdom, Animalia; Phylum, Chordata; Class, Mammalia; Order, Carnivora; Family, Felidae; Genus, Panthera; Species, leo b. Once again, I had a lot of trouble finding anything about who named the tiger. All I really got was that it was named in Asia. As for the meaning of the Tiger’s scientific name: Panthera Tigris – “large feline of forests in most of Asia having a tawny coat with black stripes; endangered” c. Lion, panther, cougar, and anything feline basically. d. Once again, I watched a movie called Kung-Fu panda at a young age and one of the characters was a tiger and named Tigris. So since then I have been relating Tigris to a tiger and any name I think of sounds unfitting. 3. a. Rosa, the full classification for a rose would be: Kingdom, Plantae; Phylum, Magnoliophyta; Class, Magnoliopsida; Order, Rosales; Family, Rosaceae; Genus, Rosoideae; Species, Rosa b. When I searched several keywords on google about when...
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...The Nameless Growth My latest challenge was a book called The Name of the Rose by Umberto Eco. I had a basic idea about what I would encounter in the reading, but I could not be so sure. Looking at the back cover, I could postulate that this would be a very logical book, possibly in the style of Sir Arthur Conan Doyle. However, this book had given me more problems than any of the Sherlock Holmes novels, mainly due to the strong aspect of religion that was ever-present in the novel. If there is one thing in this world that is the true antagonist to logic and reason, it would have to be blind faith. Never the less, I poured my V-8 Juice in my glass, sat down in my favorite red chair in the corner of my room, and cracked open the pages of the book. The Name of the Rose shares something with the last extra-credit novel that I read: an extremely slow introduction. Umberto Eco’s opening can be easily summarized in a few sentences, but Eco drags it out as slowly as one would have to drag a tauntaun through a blizzard. Basically, this is the intro: My name is Adso. My master’s name was William. I am writing about an experience I had with my master involving a supposed suicide. Oh, and even if you know a bunch about clergy history, you are going to have a bad time. Umberto Eco deems it necessary to include a history lesson when some context is missing in the telling of his story. These lessons are quite helpful in understanding what is going on in the story...
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...as much of a conflict as it would have been if Gabby had a used car dealership and decided to call it Rally¶s Used Cars. According to Robert Wayne Olson Jr¶sexample, ³The Rose Cafe (a restaurant) does not conflict with The Rose Law Firm (legalservices), nor does either conflict with Rose Story Farm (a nursery). However, if Violet Rosewants to open the Violet Rose Bistro, that name could be sufficiently confusing to bar its use inthe same area as The Rose Café.´ In my opinion it is not distinct and therefore can beconsidered as confusing. In order to be protected under tradename laws, the business owner must not have a confusingly similar name to a company that was registered in the same 4 Running head: RALLY ROUND THE TRADE NAME geographic area first. Rally is associated with pizza as well as with motors and as a result in thevideo, many consumers were confused and were calling the car dealership and placing orders for pizza.3. E xplain how important the fact is that Herman started to use the name Rally first in that particular geographical area.The fact that Herman began using the name 40 years ago protects him under common law,trade name protection by registration and he used the name first in the area. Under each of theselaws Herman is protected. Common law suggests that whoever uses the name first, in a particular geographic region and for a specific purpose will be protected. Further, registering atradename with the United States Patent Office or with the county...
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...behavior and activity: Rose was of average height and average weight, with a shapely build. She was casually attired in a sweater, jeans, and boots. She wore her hair clipped back, earrings in both ears, and a ring on her left middle finger. She wore glasses for the entirety of the interview. She displayed adequate grooming and hygiene. She displayed good posture and showed no difficulty with walking, willingly following the practitioner into the examination room. Rose had good eye contact, displayed a good level of cooperation, and wrote with her right hand. She displayed no abnormal behavior during the evaluation. Rapport was easily established. Rose put forth good effort on all tests and appeared to be motivated to do his best....
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...different names, two different stories. One story remains in the making, while the other remains as a piece of history, a souvenir from my past. My American name, Kaitlyn Rose Cooper, was given to me by my mother. Kaitlyn, a very common name here, means pure. However, that’s not the reason my mother named me that; instead, she named me after another child in my orphanage who was also being adopted. My middle name honors my grandmother, Rose Cooper. The name Rose reminds me of the sweet- smelling flower. It reminds me of beauty, gentleness, kindness, youth, and love, all of which are qualities I hope I exude towards others. Finally, my last name- Cooper. A Cooper is strong, intelligent, enduring, generous, humorous, and God-...
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...University in Opava Faculty of Philosophy and Science Pointless sacrifice in The Nightingale and the Rose English Literature 2 Name: Kocurová Michaela Field of study: English + Czech language and literature Class: second Semester: summer Year: 2012/2013 The Nightingale and the Rose is a short story written by Oscar Wilde. The story begins with a young Student crying because the daughter of the Professor told him that if he brought her red roses, she would dance with him at the ball, but there are no red roses in his garden. When a nightingale overhears what is the Student saying, she comes to a conclusion that he´s a true lover and that he knows the true meaning of Love. „‘Here, indeed, is the true lover,‘ said the Nightingale. ‚What I sing of, he suffers: what is joy to me, to him is pain. Surely love is a wonderful thing.‘“ So she makes a decision to find a red rose for him. Even before her search we get to know another characters from nature - a Green Lizard, a Butterfly and a Daisy. They think that the Student´s weeping for a red rose is ridiculous, only the Nightingale understands him and thinks about the mystery of Love. So she finds a white rose tree, a yellow rose tree and finally a red rose tree but it´s damaged after the winter and it shall have no roses at all. There is just one terrible way how to build the rose: „'If you want a red rose,' said the Tree, 'you must build it out of music by moonlight, and stain it with your own heart's-blood. You...
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...Payroll Management System Project Proposal To: Pierre Curran Marketing Incorporated From: RLKJJ Premium Software Providers * Kristine Dianne K. Maturingan * Rose Ann B. Lee * Jonathan B. Salvacion * Judy Lee B. Valderas * Johne Nicoe B. de Jesus Prepared on: PAYROLL MANAGEMENT SYSTEM Project Proposal To:Pierre Curran Marketing Incorporated From: Kristine Dianne K. Maturingan, Rose Ann B. Lee, Jonathan B. Salvacion, Judy Lee B. Valderas, and Johne Nicoe B. De Jesus RLKJJ Premium Software Providers Prepared on: PROJECT PROPOSAL INTRODUCTION Today, computer technology is at a very fast phase. Many business sectors are becoming more and more competitive by trying to make them exposed to such by upgrading their own computer systems. The use of software has become a very important aspect for a company. It changed, though not totally, the manual ways of managing their company data. It made a huge impact, especially in a company’s accounting department. The use of software has made accurate computations on the monthly payroll. It offered an easy way of putting input in the database by having all the data needed like the employees’ names, working hours, and wages. It is easy to use, effective, and efficient in organizing and computing the company’s payroll. The proposed Payroll Management System aims to be of a great help to a company’s management. PROBLEM The factors that the researchers considered before...
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..."Jack, I’m cold” said Rose. Jack said, “It’s ok Rose just hold on just a bit longer, a boat is bound to come back.” Ok Jack I trust you” said Rose. Just then Jack thought of an idea. He said “Rose, stay here I’ll be right back,” and he started swimming to dead bodies, and every time he got to a dead body he took the life jacket from them. He also took an oar that someone had abandoned. Pretty soon Jack had five life jackets and an oar and he swam back to Rose. He gave Rose the oar and said, “Okay Rose, “I have some life jackets, I’m going to put them under the door so we can both get on but I’m going to need a part of your dress.” Okay, Jack,” said Rose, and she tore off a piece of her dress and gave it to Jack. He took the dress and started to tie the life jackets together. He put them underneath the door and secured them to the handles of the door. He said, “Rose, the door should be stable. I need you to hang on to the door while I get on.” “Okay,” said Rose.” Rose grabbed the handles on both sides of the door and Jack got on. Jack started to push the door with the oar. He saw a dead man and took his life jacket. He put the life jacket on and started to push the door away from the wreckage to try to get to a boat. “Rose,” he exclaimed! “I see two boats; they are coming back!” He started to yell trying to call the boats over. Someone in the boat shouted “Survivors, on that door!” Rose had fainted, so Jack rigorously shook her to try and wake her, but it was no use. He took...
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...normal day in Los Noches. Mila-Rose and her husband Jazen were sitting on the couch in the living room of their apartment relaxing when their 15 year old daughter Crystal walks in to the room with a big smile on her face. Crystal looked exactly like her mother but she had silver hair and fair skin which she got from her father, her eyes were the same as her mothers. She was also tall like her mother and father. She also had big breasts like her mothers, which had all the guys staring at her. Her mask piece was shaped like a star in the form of a hair pen. Rose noticed the look on her daughters face first. “What are you so happy about, Crystal?” Rose asked. “I met a boy yesterday, he`s really cute and he`s a gentle man like dad.” Crystal said looking at her mother. Jazen looked at crystal and asked “what is the boy’s name?” Crystal replied “his name is Otaru and I want you to meet him.” Rose and Jazen were a little surprised by what crystal had said. No one said anything for minute then Jazen spoke up “ok, how about you invite him come over for lunch today and we will see whether or not he`s ok for you to hang out with” Jazen looked at Rose to see if she was alright with this. She nodded. Crystal smiled and said “thank you, so much!” she then hugged her father and mother then kissed them both on the cheek. Crystal then ran for the front door and went out to tell her friend the news. “She must really like this guy, if she wants us to meet him” Rose said looking at her husband...
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...Section: HBR CASE STUDY Rose Partyware's largest retail customer has decided to create a private-label line of party goods-and wants Rose to manufacture it. Should Rose put its efforts behind its own brand instead? TOM ROSE hated to go to a meeting with ice cream on his pants. But Rose Partyware's after-school party-a monthly gesture of goodwill to the local community and, not incidentally, a field trial for products the company was developing- had confirmed his suspicions that one of the new ice-cream bowls was just too shallow. The five-year-old who had demonstrated that fact had been sitting right next to him. So here he was getting ready to listen to a major presentation, with paper towels in his hands. "Go ahead, Cassie," Tom said to his marketing director. "It'll dry or harden--or something. Thankfully, it's my last meeting of the day!" He could tell that Cassie Martin was excited about the presentation she was going to make to the top management team. Tom had personally recruited her about a year ago to spearhead the biggest strategic initiative in Rose's history: the launch of a branded line of party ware. In fact, it was the first time a company in the party goods industry had contemplated a branding effort, at least in the 30 years Rose had been in business. Party Lines Rose manufactured a wide variety of paper goods- plates, bowls, cups, napkins, tablecloths, favors, crepe-paper streamers, and so forth- for birthday and holiday parties and other social...
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