Messages

Proposals

## Stuck in your homework and missing deadline? Get urgent help in \$10/Page with 24 hours deadline

Get Urgent Writing Help In Your Essays, Assignments, Homeworks, Dissertation, Thesis Or Coursework & Achieve A+ Grades.

Privacy Guaranteed - 100% Plagiarism Free Writing - Free Turnitin Report - Professional And Experienced Writers - 24/7 Online Support

# American greetings case

1. What is going on at American Greetings?

a. Discuss the competitiveness of the industry.

b. Discuss the factors that drive the fundamental value of American Greetings.

2. The shares of American Greetings are currently trading at an EBITDA multiple that is at the bottom of its peer group. Do you think a 3.5 times multiple is appropriate for American Greetings? If not, what multiple of EBITDA do you think is justified? What is the implied share price that corresponds to that multiple?

3. Using a marginal tax rate of 40% and a market risk premium of 5%, what is your estimate of the appropriate discount rate for the free cash flow forecast? Please explain your results and the implication for American Greetings. Based on a discounted cash flow model, what is your best estimate of the implied enterprise value of American Greetings and the corresponding implied share price? Explain your results and the implication for American Greetings. Use the following table to model the free cash flows for American Greetings for fiscal years 2012 through 2015. Forecast the Steady State cash flows in order to determine the Terminal Value. I have provided guidance for identifying the 2011 actual values and the forecasted values.

2011A

2012

2013

2014

2015

SS

Revenue Growth

5.3%

1.0%

1.5%

2.0%

2.5%

3.0%

Operating Margin

9.4%

9.0%

9.0%

9.0%

9.0%

9.0%

NWC Turnover

5.02

6.00

6.50

7.00

7.50

7.50

FA Turnover

1.95

1.95

1.95

1.95

1.95

1.95

WACC

9.1%

Tax Rate

40%

Revenue

Exhibit 2

EBIT

Exhibit 2

NWC

Exhibit 3

=Revenue/NWC TO

Fixed Assets

Exhibit 3

=Revenue/FA TO

ROC

=EBIT*(1-T)/(NWC+FA)

NOPAT

- Change in NWC

- Change in NFA

FCF

TV

DCF

PV

Debt

Exhibit 6

Equity

Shares

Exhibit 6

Implied Price

4. What are the key drivers of value in your model? Do you recommend repurchasing shares?

1

### Homework is Completed By:

Writer Writer Name Amount Client Comments & Rating

### Instant Homework Helper

She helped me in last minute in a very reasonable price. She is a lifesaver, I got A+ grade in my homework, I will surely hire her again for my next assignments, Thumbs Up!

### Order & Get This Solution Within 3 Hours in \$25/Page

Custom Original Solution And Get A+ Grades

• 100% Plagiarism Free
• Proper APA/MLA/Harvard Referencing
• Delivery in 3 Hours After Placing Order
• Free Turnitin Report
• Unlimited Revisions
• Privacy Guaranteed

### Order & Get This Solution Within 6 Hours in \$20/Page

Custom Original Solution And Get A+ Grades

• 100% Plagiarism Free
• Proper APA/MLA/Harvard Referencing
• Delivery in 6 Hours After Placing Order
• Free Turnitin Report
• Unlimited Revisions
• Privacy Guaranteed

### Order & Get This Solution Within 12 Hours in \$15/Page

Custom Original Solution And Get A+ Grades

• 100% Plagiarism Free
• Proper APA/MLA/Harvard Referencing
• Delivery in 12 Hours After Placing Order
• Free Turnitin Report
• Unlimited Revisions
• Privacy Guaranteed

#### 6 writers have sent their proposals to do this homework:

Writer Writer Name Offer Chat

### Assignment Guru

You can award me any time as I am ready to start your project curiously. Waiting for your positive response. Thank you!

### Accounting & Finance Master

You can award me any time as I am ready to start your project curiously. Waiting for your positive response. Thank you!

### Quality Homework Helper

I am known as Unrivaled Quality, Written to Standard, providing Plagiarism-free woork, and Always on Time