Financial health of Wal-Mart
- Assess the financial health of Wal-Mart based on analysis of the financial statements.
- Based on any additional available information (including annual reports and 10-K filings) assess the
economic conditions (as of the time of the case), the industry key success factors and competitive situation, and Wal-Mart’s strengths and weaknesses) - Determine the intrinsic value of Wal-Mart (on a per share basis) using the dividend discount model (DDM). Asses the value based on three forms of the DDM: the constant growth version, an assessment based on three years of projected dividends and a projected future stock price, and the three-stage DDM. Clearly state any assumptions including an estimation of Wal-Mart investor required returns.
- Determine the intrinsic value of Wal-Mart (on a per share basis) using the price-earnings (P/E) approach. As part of your analysis you will need to determine an appropriate forward-looking P/E multiple. Clearly state any assumptions.
- Based on your analysis, as Rachel Martin, what recommendation would you make? Justify your
recommendation and reconcile any differences in your valuation assessments (based on different methods). - for the 3 and 4, make a spreadsheet and clearly state what you did