Calculate the WACC, estimate the future cash flows and use multiples to value wood-tech. Accept the $1.5 million offer from Chinook?...

FINANCE, INSURANCE, & LAW 349:

ADVANCED FINANCIAL THEORY AND PROBLEMS Fall 2014

Pick one of the two following cases to analyze:

1. Wood-Tech Inc. 2. Facebook’s Initial Public Offering

NOTE: All cases are on ReggieNet with Excel tables.

Please prepare a write-up detailing the results of your analysis. You do not need to include a separate section

detailing the background of the case in the write-up. Instead, focus only on the financial issues and assumptions

to make your recommendation. The write-up can be no longer than 3 pages (excluding tables and charts). All

of the cases and associated Excel spreadsheets are on ReggieNet.

Due: Wednesday, December 3 rd

.

- Please turn in a hard copy to me as well as uploading an electronic copy to ReggieNet via the “File Drop” feature.

Wood-Tech Inc.:

- Calculate the WACC, estimate future cash flows and use multiples to value Wood-Tech.

- Accept the $1.5 million offer from Chinook? Why or why not?

Facebook’s Initial Public Offering:

- Calculate the WACC, estimate future cash flows, and use multiples to price Facebook’s IPO. - What is the appropriate price for the Facebook IPO? Why?

Write-up Grades:

1. Quality of information and analysis.

2. Professional appearance.

3. Assignment completed and turned in on time.

Note: This assignment is an individual project and the final paper you submit must be entirely your own work.