You will be given a scenario to analyze from a fiscal perspective to determine which option would be best financially for your company. In real life, you could have a team of bankers, lawyers, financial managers, and in some cases stockholders, to help inform your decisions. Regardless of the support in place, for the executive leader, it comes down to experience evaluating the data and how the leader communicates the best course of action for the organization to influence others.
For this summative assessment, you will act as an executive leader for ABC Company. In this scenario you must make a recommendation for one of two financial strategies for the company to increase shareholder satisfaction and make ABC stock more attractive to investors:
Strategy 1: Is expected to result in a market price of $100 per share of common stock at the present time and a price of $120 five years from now.
Strategy 2: Is expected to result in a market price of $80 at the present time and a price of $140 five years from now.
What would you recommend? Assume that other aspects of the organization will not be affected by the decision being considered to reduce confounding impacts.
Your recommendations should include the calculations based on NPV/FV distributions and the strategy of the organization. You must explain the rationale behind your recommendation and represent your understanding of financial management including cash flow, distributions, and any other integral concepts you used to inform your response.
For this summative, you should follow the APA format for the narrative and any figures or charts you include
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