Reference no: EM132888540

1. When valuing the shares of the company, I calculate the present value of the expected cash flow to shareholders and I add to the results obtained cash holding and liquid investments. Is that correct?

2. I think the free cash flow can be obtained from the equity cash flow (CFac)by using the relation :FCF=CFac+interest-D. is it true?

3. Is the relationship between capitalization and book value of shares a good guide to investments?

4. Does it make any sense to form portfolio comprised of companies with higher return per dividend?

5. A financial consultant is valuing accompany I set as an objective (entertainment centre) by discounting the cash flow until until the end of the dealership at 7.26% (interest rate year on 30 year bonds = 5.1%; market premium = 5% and beta =0.47%). 0.47% I s a better provided by Bloomberg for kinepolis ( the company whose activity is the management of several cinemas in the EU ,)in the function of Dax index. Is it correct to use the beta kinepolis in this valuation?

6. Iam confused because I see different formulae to lever and unleverbetsa imn different books(Damodaran MCkisney , Brealy 4 myers )which is the correct one?

7. An investment bank affirms that the VTS ( value of tax shields) of my company is equal to each year's VTS using the WACC as a discount rate . I told them I have never seen such calculation of the VTS but they answered that it was habitual practice. Is that true?

8. I have two valuations of thre company we set as an objective . in one pf them the present value of the tax shields (D andKd T )was calculated using Ku ( required return to unlevered equity)and, in the other side , using Kd ( required to return debt) . the second valuation is a lot higher than the first one , but which of the two is better?

9. My investment bank told me that the beta provided by Bloomberge incorporates the illiquidity ris and the small cap premium because Bloomberge does the so-called Bloomberge adjustment formula. Is thst true?

10. As my company is not listed, the investment banks apply illiquidity premium .Actually, they say it as an illiquidity premium but then they called it asmall cap premium. One of the banks, apparently based on Titman y Martin (2007) , addede the following small gap premiums; "0.91% if the capitalization is situated between $1, 167 and $ 4,794 million ;1.70% if the capitalization is between $331 and $ 1,167million .;4.01% if it is lower than that of abig companies . which one is more appropruaete?