Corporate Finance - Strategies and Financial Analysis of Altadis

Running head: CORPORATE FINANCE
Corporate Finance
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Author’s Note:

1
CORPORATE FINANCE
Introduction
This paper looks to provide an explanation of the strategies that have been undertaken by
Altadis in order to enhance their operational activities. The company has introduced several
plans and strategies within their financial aspects with the help of which they would be able to
increase their extent of profit. All the aspects as well as the strategies will be addressed and
thereby opinion in accordance to the same would be given in order to provide a brief idea about
the effectiveness of the strategies that have been incorporated by the company.
Answer to Question No 1
Altadis follows a cash flow driven approach and the discounted cash flow driven target
price recommends to have an upside potential of more than 20%. In this manner, the company
has the capability to outperform their European competitors. The main factor as the company
would be able to outperform from their competitors has been due to the fact that Altadis has been
restructuring, buying back their shares and has been making use of the developments that is seen
in the emerging markets.
The company maintains a shareholder remuneration policy with the help of which they
have been able to provide remuneration to their shareholders and the percentage of remuneration
has been increasing as the years pass by. This indicates that the company has been performing
well and therefore has been able to pay for the remuneration out of their profits. The company
due to their shareholder remuneration policy have an underpinned valuation. The company has
undertaken the plan to buy back their share capital and in this manner the organization has been
planning to increase their return.