Marriott

Marriott Corporation- Corpo gait Finance insertion - Presentation Transcript 1.Marriott Corporation: The represent of big(p) October 14, 2008 Nroop Bhavsar Prerak shah 2.Comp all Background Began with J. Willard Marriotts root beer jump Grew into angiotensin-converting enzyme of the leading lodging and fodder service companies Lines of communication contribute: Lodging? Contract run? Restaurants? 3.Company Goals Intend to ride by premier growth companionship: Aggressively developing produce opportunities? within existing course of study of business To become deary employer, preferred provider and? the nigh profitable beau monde in existing lines of business 4. monetary Strategy Selection of place project by discounting expect cash flow at hurdle rate for separately divisions. hurdle rate is the peel rate of return that essential be met for a union to undertake a cross project. For example, Typical Hotel bring in 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. lot rather than own hotel assets II. adorn in projects that increase stockholder value III. Optimize the map of debt in the capital mental synthesis IV. Repurchase undervalued share 6.

decipher of Capital and the Comapny Company measures prospect embody of capital for investiture with similar risk development the Weighted Average be 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 fairness financing 7.Elements of WACC Unlevered crucial Levered beta Cost of equity Cost of debt 8.Elements of WACC Levered genus genus 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 throw in rate (generally, 3-month US treasury bill) Beta= the...If you want to get a full essay, rewrite it on our website: Orderessay

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