Financial Analysis of Worldpay Inc and Z1P Co Limited

Running Head: Financial Analysis
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Project Report: Financial Analysis

Financial Analysis
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Contents
Introduction:.....................................................................................................................3
Company overview:..........................................................................................................3
WACC:.............................................................................................................................3
Dividend discount model:.................................................................................................4
Earnings residual model:..................................................................................................4
Discounted cash flow model:............................................................................................5
Analysis:...........................................................................................................................5
Recommendation and conclusion:....................................................................................5
References:.......................................................................................................................6
Appendix:.........................................................................................................................7

Financial Analysis
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Introduction:
The report explains about the investment opportunity of 2 companies which are World
pay Inc and Z1P co Limited. This report emphasizes that which company is a good option for
the purpose of investment. The report mainly focuses on identifying the stock value of the
companies on the basis of various valuation models. It explains that whether the investment
into the company is commendable for the investors or not. In this report, 3 valuation models
has been applied on World pay Inc and Z1P co limited which are dividend discount model,
earnings residual model and discounted cash flow.
Company overview:
Worldpay Inc is a payment processing company. The company has been founded in
1989 and the main services of the company are payment gateway and payment services. The
company has listed in New York Stock exchange. The revenue of the company was Pound
4.5408 (Home, 2018).
In addition, the Z1P Company limited is an Australian company which offers a cloud
based platform to its client. The company offers point of sales credit and digital payment
services to the merchants and the consumers. The company mainly focuses on the simplicity
and it delivers the responsible and transparent and fairly prices consumer credit products
(Home, 2018).
WACC:
WACC calculations of Worldplay explain that the total cost of capital of WP is 4.37%
which includes the cost of equity and cost of debt of the company. The calculations express
that the cost of equity of the company is 6.94% and cost of debt is 4.2% (Bloomberg, 2018).
It further leads to 6.14% equity and 93.85% of debt in total capital structure of the company.
Thus the WACC of the company is 4.37%.
Further, WACC calculations of Z1P Co limited explain that the total cost of capital of
WP is 16.43% which includes the cost of equity and cost of debt of the company. The
calculations express that the cost of equity of the company is 26.84% and cost of debt is