A Global Energy Company

1299 Words6 Pages
Midland is a global energy company with three separate divisions, oil and gas exploration and production, refining and marketing, and petrochemicals. Exploration and production of oil and gas was Midlands most profitable business making $12.6 billion after-tax earnings and $22.4 billion of revenue, extracting about 2.10 barrels of oil per day in 2006. Petrochemicals’ was the least profitable business, making $2.1 billion after-tax in earnings. Midland had been incorporated 120 years before 2009 and during 2007 employed over 80,000 people. It is a publicly traded company, trading at $44.11 during the fourth quarter of 2006 and $24.13 in 2001 during the first quarter. That is approximately a 76% increase in the stock during that period of time. Midland also pays a dividend letting us know that they are doing well, not to say that just because a company doesn’t pay a dividend it doesn’t mean they company is doing bad. From exhibit 4 it looks like the annual dividend increased by .35 cents. Earnings per share did decrease from 7.47 to 6.34, this means that the amount of profit assigned to each share decreased. The company’s had a financial strategy based on the following, to fund significant overseas growth, to capitalize in value-creating projects for all three segments, to improve its capital structure and to repurchase undervalued shares. In order to accomplish these goals the company must calculate the cost of capital to figure out the estimates for their
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