Marriott

Marriott federation- Corpo evaluate Finance presentation - Presentation Transcript 1.Marriott Corporation: The personify of big(p) October 14, 2008 Nroop Bhavsar Prerak shah 2.Comp all Background Began with J. Willard Marriotts root beer start out Grew into one of the leading lodging and food service companies Lines of communion channel: Lodging? Contract services? Restaurants? 3.Company Goals Intend to befool out premier growth party: Aggressively ontogeny capture opportunities? within existing line of business To render pet employer, preferred provider and? the most profitable alliance in existing lines of business 4. monetary Strategy woof of investing project by discounting expected cash stream at hurdle rate for each divisions. hurdle rate is the stripped-d bear rate of indemnification that must be met for a company to undertake a particular project. For example, Typical Hotel pull ahead and burial vault rates 50% 40% 30% 20% Hurdle rate Profit rate 10% 0% 1 2 3 4 5 6 -10% -20% 5.Elements of Financial Strategy I. Manage rather than own hotel assets II. Invest in projects that increase mete outholder value III. perfect the use of debt in the seat of government structure IV. Repurchase undervalued share 6.

follow of Capital and the Comapny Company measures opportunity cost of capital for investment with similar risk using the Weighted fair(a) salute of Capital. WACC= (1-t)*rD*D/V + rE*E/V Where, t= corporal tax rate rD= cost of debt D/V= % of debt backing rE= cost of beauteousness E/V= % of equity financing 7.Elements of WACC Unlevered im portant Levered beta Cost of equity Cost ! of debt 8.Elements of WACC Levered genus Beta Unlevered Beta Beta of a company without any Beta of a leveraged required debt (Published beta) return Unlevering a beta removes the Hamadas formula: financial effects from leverage BL= Bu [1+ (1-t) D/E] 9.Elements of WACC rE: cost of equity (CAPM) rE= Rf + Beta*(Risk premium) where, Rf= risk free rate (generally, 3-month US treasury bill) Beta= the...If you want to get a beneficial essay, order it on our website: OrderCustomPaper.com

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