This case gives comprehensive coverage of a firm’s decision to start an initial public offering but also to go through the process of going public. TRX is a company managing travel-and-data processing activities for its clients. Its target market has significant transaction volume in travel agencies, travel suppliers, large corporation and credit-card issuer. Regarding its service offerings, it focuses on transaction processing, data integration and customer care. Its fortune tied to the overall health of travel industry. TRX generates a lot of revenue but less profit. Trip Davis, Chief Executive Officer of TRX, Inc. decided it was time to raise capital in order to fund the growth of the company. His main focus was to accomplish a strategic recapitalization of TRX. This case gives a brief history about several events from the company’s incorporation in 1999 through the completion of an IPO in September 2005. The main goal is to raise capital but there is also a consideration of another reason for going public. In November 1999, they tried to go public but the IPO was never finalized. After the failed IPO, Trip Davis and TRX president decided to focus on strategic investors in order to raise $20 million convertible into equity at $11 per share. In 2004, he believed that Sabre, Inc. one of the largest strategic investors was not working for the best interest of the company. He took into consideration three possible capital raising options: IPO, private placement of equity, or
The remainder of this note discusses each of the steps in the process and then provides an exercise on the various financial measures that are useful as part of the analysis. The final section of the note demonstrates the relationship between a firm’s strategy and operating characteristics; and its financial characteristics.
In this paper I intend to provide a sound financial analysis of Tesla Motors Incorporated. I will do so by calculating and providing liquidity, profitability, and solvency ratios and then evaluating those results. Assessment of these ratios will more or less define Tesla Motors’ abilities to meet its short-term debts and obligations (liquidity), performance in relation to sales, assets, and profits or losses (profitability), and the resulting income amount, after tax deductions, against the company’s liabilities (solvency). Additionally I will compare
This is an inductive research where quantitative methods have been used. The quantitative analysis consists of stock price data acquired from the New York Stock Exchange and the results of audit regarding company 's internal control over financial reporting required by the Sarbanes Oxley Act.
Address the following questions in a 4-5 page write-up of the Boston Beer Company Case to explore the issue of Initial Public Offerings.
Assume that you are a CEO of a medium-sized company that needs a significant influx of cash for several expansion projects. As the CEO, you must determine whether your company should remain private or go public. Some companies postpone going public due to the unpredictability of economic and market conditions. Consider the ramifications of both alternatives. Construct an argument for and against going public. Before providing your response, review the guidelines and regulations associated with going public by visiting Small Business and the SEC located at http://www.sec.gov/info/smallbus/qasbsec.htm.
Major companies and corporations that comprise a big part of the United States economy take advantage of certain opportunities such as going public through IPO’s, acquisitions, and mergers. These three approaches provide an additional resource and many times an advantage to expand, become more profitable, or simply save a company’s existence.
Address the following questions in a 4-5 page write-up of the Boston Beer Company Case to explore the issue of Initial Public Offerings.
Every day adults are forced to make decisions whether it is personal, professional or educational. Many people utilize experience or training to make their decision while others rely on a gut feeling. Some decisions can be made in an instance such as what to eat for lunch, and some are made after extensive research and discussions. This approach to decision-making is no different when it is a company who is deciding. Smart executives rely on in-depth research and consultations with subject matter experts before they make a conclusion especially when it comes to spending their money or investing to generate capital. One resource available to the public to research an organization’s financial condition is the Form 10-K. Ford Motor Company is an auto industry giant who experienced severe highs and lows over the last twenty years. Their 10-Ks are provided to their shareholders to review the company’s previous year’s performance. It is the organization’s report card for the SEC as well as current and future stockholders. Analyzing a company’s 10-K prior to investing will provide a solid foundation on the strengths of the company and the risk of purchasing their stock.
As we examined the financial evaluation of Caesars Entertainment Corporation, it will reveal the financial stability of its revenues, gross margin, and earnings per share. The largest gaming companies in the world under the leadership of CEO Mark Frissora and its 31,000 employees. It is ranked #7 in the Airlines, Hotel & Travel industry. Its ticker symbol was CZR, established in 1989. Now as we further examine the financial of Caesars, we will describe the profitability, liquidity, solvency, and the positive/negative trends over the last three (3) years. The profitability will show and yield profit or financial gain. Liquidity will describe and reveal the availability of liquid assets; how easy it is to convert assets to cash.
Pink sheet stocks and penny stocks are ways of earning money. During the beginning of 1900, numerous intermediaries and speculation houses exchanged organizations over the counter for retail customers. Financial specialists had a wild time looking forward to discover exact offer approach spreads for these organizations, and notwithstanding when speculators found a quote, which took by days and weeks. Out of this franticness emerged the National Quotation Board (NQB). The early organizers of the NQB set out to give a thorough rundown to over-the-counter organizations on a week by week premise. This gave speculators the capacity to discover quotes on a substantial number of organizations. This week after week distribution was imprinted on pink colored pages, consequently the term pink sheets.
Review of Financial Research Report: This assignment is an analysis of a US publicly-traded company; its common stock could be a prospective investment. The report is due in Week 10, in needs to be at least 5 pages, and it needs to cover the following topics:
There are considerable advantages with obtaining equity through the IPO process. There are, however, some drawbacks that also need to be taken into consideration. Some of the advantages and disadvantages are:
Therefore, these concerns can only be handled after the company decides on the offering structure, which defines investor’s demographic and a precise stock exchange to list on. Afterward, the company and its underwriters must begin to prepare the required documentation for both potential investors and regulators. The main documents are registration statements and a prospectus which contains all the financial and non-financial information that potential investors require in order to make the investment decision. In most countries, the contents of the prospectus must be approved by the local securities regulators before it can be distributed to potential buyers. (Bodie et al. 2005,
The Geox Company is a great example of how an idea can become reality. In order for the idea of the company’s founder and CEO Mario Moretti Polegato used various concepts to create the products that led to the Geox Company to become what it is today. Polegato had developed the idea of “breathable” shoes while at a wine trade show in Nevada. (Farhoomand, 2010) Polegato’s feet were uncomfortable in an old pair of sneakers so he proceeded to make a hole in each of sole of the shoe. This resulted in relief from his discomfort.
This case analysis looks at Southwest Airlines and how the company is in a vital financial position. The analysis was done using news articles, the company’s website and finance websites. The research was used to focus on how they have a strong employee to company relationship and customer to company relationships that they do not want to jeopardize and ruin but they need to bring forth $100 million without laying off employees and losing customers due to raising fare prices. This analysis shows how Southwest is looking into new ideas that will enhance the brand and in the long run make them successful.