Sumários
Rasing capital and financial policy in practice
23 Novembro 2020, 10:00 • JOÃO CARLOS CARVALHO DAS NEVES
Incorporating business risk and financial risk in the financial policy
Determinants of financial policy in pratice
Estimating the amount of required external funds
Mains sources of business finance
The financial system and the various sources of financing
The new trend of green financing
Designing a capital structure
17 Novembro 2020, 10:00 • JOÃO CARLOS CARVALHO DAS NEVES
Capital structure irrelevance
Benefit from tax deductibility of interest
Financial distress costs
Static trade-off theory
Agency costs
Asymmetric information costs
Debt rating effects
Capital structure policy
Leverage in an international setting
Designing a Capital Structure
16 Novembro 2020, 10:00 • JOÃO CARLOS CARVALHO DAS NEVES
Capital structure irrelevance
Benefit from tax deductibility of interest
Financial distress costs
Static trade-off theory
Agency costs
Asymmetric information costs
Debt rating effects
Capital structure policy
Leverage in an international setting
Investment appraisal techniques
11 Novembro 2020, 10:00 • JOÃO CARLOS CARVALHO DAS NEVES
This class was in substitution of the missed class at 26-10-2020
Investment appraisal metrics:NPV, IRR, Modified IRR, Profitability Index and Equivalent Annual Annuity
Why inflation matters
Special cases of capital budgeting: Comparing projects with unequal cash timings, unequal sizes, unequal life spans, unequal risks, corporate budget constraints
Why NPV is more reliable than other metrics: Measures value creation, timing of cash flows, risks of projects cash flow and sdditivity
Identifying and estimating a project’s relevant cash flows
1. DCF models 2. Capital budgeting risk analysis
10 Novembro 2020, 10:00 • JOÃO CARLOS CARVALHO DAS NEVES
- Discounted Cash Flow Methods
WACC method - Project Cash Flow discounted to the WACC - The method most used in practice. Advantageous and disadvantageous
Equity method - Equity cash flow discounted to the cost of equity - Advantageous and disadvantageous
Adjusted Present Value - Project Cash Flow discounted to the unlevered cost of capital plus the value created by debt (usually the tax shield value)
MVA as present value of EVA
MVA as an equivante to NPV
2. Capital budgeting risk analysis
Risk and uncertainty
Methods to analyse risk