Unihost Corporation

Convertibles are appealing to investors who are looking for an investment with greater growth potential than that offered by a traditional bond. By purchasing a convertible bond, the investor can still receive

United Services is the most-trusted machinery moving and equipment rental company in Rochester. For nearly 50 years, this local company has provided the surrounding community with the industry's leading equipment, affordable costs and outstanding customer service. Whether you need rigging supplies or crane rental services, contact United Services for all your heavy machinery needs.

UnitedHealth Group Incorporated (NYSE: UNH) is a diversified health and well-being company dedicated to helping people live healthier lives and making health care works better. Through its family of subsidiaries and divisions, UnitedHealth Group serves approximately 70 million individuals throughout United States and has a reported income of 8.4 billion in 2015. UnitedHealth’s business model is highly adaptable, which allows them to quickly and effectively address emerging needs in a changing healthcare landscape. UnitedHealth, which is listed as No. 14 on the Fortune 500, serve the markets for health benefits and health services through Unitedhealthcare and Optum repectively.

Along with market performance, a firm may need to adapt its financial activities as well. These activities all relate to the way the firm is organized, in particular, its capital structure. Included in capital structure is the aspect of convertible bonds. These bonds can be converted to a specified amount of common stock. The downside of these convertible stocks and bonds is that they have the potential of diluting the Earnings Per Share (EPS)

Issuing new shares and moving to retire outstanding debt reduces leverage reduces the degree of exposure and magnification that the company will experience due to cash flow and other economic fluctuations-by reducing fixed costs and spreading the exposure around to a wider pool of investors (Bierman, 2003). This would be most advantageous during a year when it is expected that there will be a tightening of

J. Willard Marriott started Marriott Corporation in 1927 with a root beer stand, expanding it into a leading lodging and food service company with sales of over $6 billion by 1987. At the time, Marriott had three main lines of business, lodging, contract services and restaurants, with lodging generating about 51% of company’s profits. The four key elements of Marriott’s financial strategy were managing hotel assets rather than owning, investing in projects with the goal of increasing shareholder value, optimizing the use of debt, and repurchasing their undervalued shares. Marriott Corporation relied on measuring the opportunity cost of capital for investments by utilizing the

Given the above market perception of risk and growth opportunity, issuing a convertible bond is appropriate because it would allow the company to raise capital at more advantageous terms than it would when it issues straight debt. Investors would be willing to supply funds at a lower rate if they can have the opportunity to benefit from the upside potential of the stock. Hence, the value of convertible bonds becomes insensitive to the risk of the company. Investors would not be materially affected if the company becomes more volatile as a result of added risk in the future because the call option value of the convertible bond will likewise increase. Upside returns due to increase in risk will also accrue to investors holding a convertible bond, while having a downside protection because of the part-debt nature of the convertible.

This paper seeks to discuss securitisation as a viable, and an alternative way of raising additional capital for business organisations. Business organisations and other corporate entities require substantial capital to grow and expand their ventures. When the financial resources of a business entity are stretched to the limit, equity capital is scarce and therefore expansion is stalled. Therefore, in order to improve their financial liquidity, the shareholders may not be ready to relinquish their holdings by issuing stocks to the public. Hence, they have resorted to innovative ways of raising additional capital with minimal cost. Securitisation has been found to be a convenient way of raising funds by transforming unmarketable assets/receivables into tradable securities through the instrumentality of Special Purpose Vehicles (SPVs). For this reason, the securitisation market has continued to grow. Securitisation has witnessed exponential growth from a non-existent industry in 1970 to $6.6 trillion as of the second quarter of 2003. As it has been revealed in numerous instances, SPVs have been put to various use by

This report is an analysis of a bond issued by Dynegy Inc. (DYN), an electric supply and sales company. DYN issued a 5.875% semi-annual coupon corporate bond on December 1, 2013 for face value of $10,000. The bond matures on June 1, 2023 with an initial call date on June 1, 2018 and a discounted call price of $9,455.00. Because this is a callable bond, we can expect a few possible yields from investing in this bond. The yield to maturity (YTM) was calculated to be 7.1367%. This will be the yield gained on the assumption that the bond is held to maturity from the settled date of October 23, 2014. The bond’s first yield to call (YTC) is the highest among the succeeding call dates and is calculated to be 8.369%. Despite being significantly higher than the YTM, DYN will not likely call the bond because the interest rate is expected to increase in the future; this means that DYN cannot refinance the debt with a lower rate. Even though the YTM is lower, we still found it to be relatively high after making a comparison with other bonds of similar characteristic. Continuing with the expectation of the bond not being called, we can expect the calculated duration of 6.66 years to hold true. This means that if an investment is made in this bond, you can expect to breakeven in year 6.66. This short period would be an attractive feature for an investor as the risk of loss is minimized time-wise.

Throughout this paper I will attempt to give financial advise to a business that will have direct impact on operations and the ability to successfully compete in the marketplace. Some of the tasks involved in delivering sound advice to this business is the first task that consist of describing the advice that I would give to the client for raising business capital using both debt and equity options in today’s economy, while outlining the major advantages and disadvantages of each option. The second task involves the attempt to summarize the advice that I would give the client on selecting an investment banker to assist the business in raising this capital. The third and final task entails the

Every business organization strives at expanding. However, expansion requires financial resources. There are two forms of financial resources namely debt and equity. What type of advice would a financial advisor by able to provide to their client. Discuss the advantages and disadvantage of each type of capital raising technique. What information could you provide your client on choosing an investment banker? What are the historical relationships between risk and reward of common stocks versus corporate bonds? How does diversification help in risk reduction?

Survey the main considerations in the basic choice between debt and equity financing. The case allows an application of the classic FRICTO (flexibility, risk, income, control, timing, and other) framework, as well as

This essay aims to explain why some firms issue marketable debt and why some issue non-marketable debt and who is more likely to issue one type of debt rather than the other one.

The financial decisions of any type of an organisation can be divided into two categories. The first of these is concerned with spending – what spending decisions should be made in order to suffice a particular organisation’s future goals, which might be expressed in terms of profits, success in competition, new product development, growth and so forth. However, in order to realise these visions, each company necessarily needs to make decisions falling into the second category which is concerned with raising money for its spending. Spending financing represents an important issue in each company’s existence as the decisions within this category can have a wide variety of influences on the present and future of each organisation. A

There are two basic types of securities, stocks and bonds. Although with both of these investments, money in exchanged for a certificate, they are fundamentally different. A stock is evidence of being a shareholder, hence an owner in a company. A bond, on the other hand, while still a certificate, represents a contract and evidence of a loan to a company. Therefore stock is a form of an equity investment and bonds are a form of a debt investment. Although there are a variety of stocks and bonds, this paper will focus on common stock and corporate bonds and highlight the advantages and disadvantages of investing in either of these two financial instruments. Knowing the difference between stocks and bonds will help investors find the right level of risk and return for their portfolios.