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Business Valuation and Analysis PDF

   

Added on  2020-04-29

16 Pages2969 Words54 Views
Running head: BUSINESS VALUATION AND ANALYSISBusiness Valuation and AnalysisName of the Student:Name of the University:Author Note:
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2BUSINESS VALUATION AND ANALYSISTable of ContentsIntroduction......................................................................................................................................4Competitive Industry Structure........................................................................................................4Macro-Environment Overview....................................................................................................4Political and Legal factors...........................................................................................................4Economical factors......................................................................................................................5Socio and Ecological factors.......................................................................................................5Technological factor....................................................................................................................6Industry overview............................................................................................................................6Industry Life Cycle......................................................................................................................6Threat of new entrants.................................................................................................................6Internal rivalry.............................................................................................................................7Power of buyers...........................................................................................................................7Power of suppliers.......................................................................................................................7Threat of substitutes.....................................................................................................................7Star Entertainment Competitive Positioning and Corporate Strategy.............................................8Corporate Strategy of Star Entertainment Group........................................................................8Competitive Positioning..............................................................................................................9Investment Risks..............................................................................................................................9Exchange Rate Risk...................................................................................................................10
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3BUSINESS VALUATION AND ANALYSISProfitability Analysis.....................................................................................................................10Calculation of WACC....................................................................................................................11Free Cash flow...............................................................................................................................11Conclusion.....................................................................................................................................13References and Bibliography.........................................................................................................14
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4BUSINESS VALUATION AND ANALYSISIntroduction This study deals with a company named as Star Entertainment Group that is theworldwide leader of the casino as well as gaming business in the recent annual evaluation for theDow Jones Sustainability Index (Starentertainmentgroup.com, 2017). The current segmentexplains about external competitive forces by the help of Porter’s Five Forces Model where themain components are bargaining power of suppliers, bargaining power of customers, threat ofnew entrants, threats of substitutes and competitive opposition. The present study analyzes themarket pricing by using market valuation techniques. Cost of debt, cost of equity as well as costof capital of Star Entertainment Group is calculated in the current assignment with properjustification. Furthermore, the study even estimates free cash flow of Star Entertainment Groupin the most appropriate way (Weil, Schipper & Francis, 2013). Lastly, the study estimates thetarget price of Star Entertainment Group and provides recommendations on whether to buy orsell or hold to the client and drawing conclusion to it. Star Entertainment Group believes indelivering excellent results as well as enhancing shareholder value in the year 2016. Competitive Industry Structure Macro-Environment Overview Political and Legal factors Star Entertainment Group analyzes various factors that either enters or invest in a certainmarket. Political factors plats important role for determining the factors that affect the long-termprofitability of Star Entertainment Group in a specific market. Some of the political factors are asfollows:Industrial safety regulations in the consumer services sector Wage legislation that include minimum wage as well as overtime Pricing regulations Legal framework for contract enforcement Risk of military invasion
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