{"id":126467,"date":"2018-02-20T23:50:30","date_gmt":"2018-02-20T23:50:30","guid":{"rendered":"https:\/\/writemyessayfree.com\/valuation-project-of-the-panera-bread-company"},"modified":"2017-08-16T06:10:15","modified_gmt":"2017-08-16T06:10:15","slug":"valuation-project-of-the-panera-bread-company","status":"publish","type":"post","link":"https:\/\/www.benedictsol.com\/blogs\/valuation-project-of-the-panera-bread-company\/","title":{"rendered":"Valuation Project of The Panera Bread Company"},"content":{"rendered":"
\n

Valuation Project<\/strong><\/p>\n

Purpose<\/strong>: The purpose of this project is evaluating the valuation of The Panera Bread Company.<\/p>\n

Background<\/strong>: For this project, the focus is on the major considerations, and the process, involved in forecasting financial statements, calculating cash flows, estimating the cost of capital, and applying various valuation models.<\/p>\n

Instructions<\/strong>: To prepare for this project, do the following<\/p>\n

\u00b7 Use the Excel file \u201cValuation Project \u2013 Spreadsheet \u2013 Start.xlsx\u201d on blackboard for this project. It contains a template for you to enter four-years of historical financial data along with four years of pro-forma data.<\/p>\n

\u00b7 Enter the historical financial data for Panera Bread Co. into the spreadsheet. If your financial statements include a row that is not included in the spreadsheet provided, then aggregate the data into one of the \u201cother\u201d categories. For example, in the spreadsheet I am providing, there is no line for \u201cgoodwill.\u201d If Panera Bread has a line for goodwill, add it to the \u201cother LT asset\u201d category. Similarly, if your income statement has a line item not included in the provided template, aggregate it into one of the existing line items or place it in the \u201canything else\u201d category. Let\u2019s make this as simple as possible.<\/p>\n

o Make sure assets balance with liabilities plus equity as you manually enter numbers<\/p>\n

o Don\u2019t worry too much if you can\u2019t place things perfectly<\/p>\n

\u00b7 In the financial statement portion, the cells that are shaded blue or green already have equations in them \u2013 you do not need to modify them.<\/p>\n

\u00b7 Fill in the historical and forecast years on your spreadsheet.<\/p>\n

\u00b7 After you have entered your historical data into the spreadsheet provided, answer the following (type your answers in this word document):<\/p>\n

PART I: CREATE PRO-FORMA FINANCIAL STATEMENTS<\/strong><\/p>\n

1) Forecast all the line items in the income statement and balance sheet. In the table below, write down all the line items that you chose to forecast in the following tables (if you run out of room, add a new line to the table).<\/p>\n\n\n\n\n\n
Income Statement Line Item<\/td>\nForecast method<\/td>\n<\/tr>\n
Example: revenue<\/td>\nAssumed 3% growth, from 10K\u2019s<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n\n\n\n\n\n
Balance Sheet Line Item<\/td>\nForecast Method<\/td>\n<\/tr>\n
Example: Cash<\/td>\nAssumed 7% of sales, in line with historical values<\/td>\n<\/tr>\n
<\/td>\n<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

2) How did you forecast depreciation?<\/p>\n

3) How did you forecast your interest expense?<\/p>\n

4) Calculate the numbers for ENIAT, NWC, etc., in the portion of the spreadsheet that is shaded in grey below the income statement and balance sheet.<\/p>\n

PART II: FORECAST FREE CASH FLOWS AND FLOWS TO EQUITY<\/strong><\/p>\n

5) Calculate your free cash flows (FCF) using equation (3) from the book. Calculate your flows to equity (FTE) in the table provided in the excel template.<\/p>\n

PART III: DETERMINE YOUR DISCOUNT RATES<\/strong><\/p>\n

6) Determine your equity discount rate Re using the CAPM and add it to the Excel template. Describe how you did this below.<\/p>\n

7) Determine your debt discount rate Rd. Describe how you did this below.<\/p>\n

8) Determine your asset discount rate and the weighted average cost of capital (Ra and Rwacc). Describe how you did this below.<\/p>\n

PART IV: PERFORM THE VALUATION<\/strong><\/p>\n

9) Determine the asset value of Panera Bread using the APV method by filling in the appropriate portion of the spreadsheet.<\/p>\n

10)Determine the asset value of Panera Bread using the WACC method by filling in the appropriate portion of the spreadsheet.<\/p>\n

11)Value the equity Panera Bread company by filling in the appropriate portion of the spreadsheet. How does your estimate of the equity compare to the market capitalization of your firm (which is what the market things the value of the equity should be).<\/p>\n

12)In each of the above cases, you will need to come up with a terminal value for your cash flows. To do this, use a growing perpetuity model. Assume that the cash flow in year 5 is equal to the cash flow in year 4 multiplied by (1 + growth rate).<\/p>\n

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Attachments:<\/span><\/p>\n

\n
\n Valuation-Pro\u2026.xlsx<\/a>\n <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/p><\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Valuation Project Purpose: The purpose of this project is evaluating the valuation of The Panera Bread Company. Background: For this project, the focus is on the major considerations, and the process, involved in forecasting financial statements, calculating cash flows, estimating Read More …<\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[],"class_list":["post-126467","post","type-post","status-publish","format-standard","hentry"],"_links":{"self":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/126467","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/comments?post=126467"}],"version-history":[{"count":0,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/posts\/126467\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/media?parent=126467"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/categories?post=126467"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.benedictsol.com\/blogs\/wp-json\/wp\/v2\/tags?post=126467"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}