Harris Seafood Case Summary

Estimate the cost of capital for financing (Hint: Interest expense and total debt – Ascertain the return on equity to provide measures for the interest rate and the return to stockholders.

Tucker should invest in this project based on Gates’ projections with NPV above 450K and 84% IRR. If we assume a growth rate of 2% beyond year 2011 and COGS 30% of the revenue, we still get NPV of $383,920.4. Based on these calculations, we would recommend Tucker Hansson to invest in the project.

The report will seek to identify Accuflow enterprise value from the viewpoints of the different parties and with different valuation techniques in order to come to the conclusion.

e. value is what the seller receives when we buy a good and price is what we must pay when

You have standardized value and customized value. Standardized value deals with its face value. Customized value centers around what its made of to make in valuable. Value is hard to distribute because everyone has their own idea what is important. Stone uses the example of an education.

Given the changes in Red Lobster’s strategy over the past few years and the surprising ability to attract new, “experiential” customers, it our recommendation that they modify their strategy to focus on pursuing this type of clientele. We will go into further detail momentarily; however, the reason for focusing on the experiential customer group is that Red Lobster has the opportunity to increase revenue and net operating income at each restaurant by 20% or more. Granted, these are enormous gains and it will take a few years to realize their full potential, but for the reasons laid out below, we believe these gains are a realistic possibility.

In determining the FMV of both classes of NYC medallions, we analyzed the various methodologies for calculating the estimated value of the medallion and found the approach used in this report, the income approach, to be the most concrete based on factual data to render this type of assessment. As such, the analysis in this report is limited to, and only should be adopted holistically with, the pertinent qualifying parameters.

Furthermore, some of these values,

At 30 June 2014, the balance of the revaluation surplus is $400 000, of which $300 000 relates to the factory land and $100 000 to the buildings. On this same date, independent valuations of the land and building are obtained. In relation to the above assets, the assessed fair values at 30 June 2014 are:

Value: An object, product or service that: has utility or usefulness, Is scarce, Is desired by people (is in demand),Is transferable from one person to anotherLand Appraisal Methods: Market or Direct Sales Comparison, Allocation, Abstraction, Development, Land Residual

This is beyond the company cost limit set of $16 million capital and $2.6 million yearly payment for improvement. The company is committed to keep the plant but at the basis on the cost limit set.

According to Aswath Damodaran, relative valuation is the most widely used technique in sell side research at investment banks. Relative valuation is the concept of using multiples and comparing the value of an asset to a similar asset in the market. Purchasing a house uses concepts of relative valuation. Houses are priced by comparing other houses that have similar specification within the same neighborhood.

Comments from teacher: In question 1, why do we use these equitation’s, explain and show then, i.e. ROE can go up with more leverage. More on comparables. In Q1 assumptions explained, that are then used in DCF. Max for question 1 and 2, two pages. Must power to put in Q3. Deduct tax in table 3. In DCF, show more how calculated and assumption missing about other income and corporate expenses. Table 6 to be fixed (already been done). Skip in DCF advantage and disadvantage. Do table 4 different, use Exhibit 11, value range, use median value and calculate enterprise value with multiples en deduct net debt 318,5 and get equity value. Explain better in main text footnote 12. . Use

5. If debt is used to finance this project, should the interest payments associated with this new debt be considered cash flows?

The science is performing each valuation correctly, the art is using each method to develop a recommendation