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CORPORATE FINANCE

Program

EN IT

Updated A.Y. 2018-2019

Academic year 2018-2019

 

Overview

The course analyses corporate finance issues looking to both the investment and the financing policy. Students will be able to understand strategic and practical investment/debt issues and to implement (through excel) standard capital budgeting technique and financial debt planning policy.

At the end of the course, students will be able to:

1. Use the NPV for evaluating real and financial investments;
2. Consider portfolio construction criteria and the impact on the firm’s risk exposure;
3. Evaluate the impact of capital structure choices on the stakeholders.
4. Measure the impact of market imperfection on the firm’s value

Pre-requisites for the Course:

Students are required to have basic knowledge of mathematical finance (interest rate and present value) and balance sheet analysis (Financial Statement)
Students that do not have such skills have to study in advance the following compulsory readings:

Berk J. and De Marzo P., Corporate Finance – Global Edition, Pearson – Chapter 3-4

Learning Objectives

Knowledge and Understanding

Knowledge and understanding of the theories and practices in corporate finance using a international point of view.

Applying Knowledge and Understanding

The course is base on applied financial data analysis and will introduce students to the best practice in the corporate finance issues

Making Judgements

Identifying key variables in selecting among real and financial investment opportunties considering the implications related to the investment selection criterion used.

Communication Skills

Summarize and present financial data necessary for evaluating investment opportunities

Learning Skills

Analizing critically financial data and discuss the implication of the results achieved

Detailed program

Date

Topic

Chapter

Pages

01

18-02-19

Corporation and corporate governance

Chapter 1

34-54

02

19-02-19

Financial Statement Analysis

Chapter 2

55-92

03

20-02-19

Investment decision rules

Chapter 7

206-232

04

21-02-19

Fundamentals of Capital Budgeting

Chapter 8

271-308

05

25-02-19

Bond Valuation

Chapter 6

205-243

06

26-02-19

Valuing Stocks

Chapter 9

309-349

07

27-02-19

Portfolio return and risk

Chapter 11

389-408

08

28-02-19

Optimal Portfolio Choice and the Capital Asset Pricing Model

Chapter 11

409-438

09

04-03-19

Estimating the Cost of Equity and the Cost of Debt

Chapter 12

439-451

10

06-03-19

Project’s Cost of Capital

Chapter 12

452-476

11

11-03-19

Market efficiency

Chapter 13

477-519

12

12-03-19

Capital Structure in a Perfect Market

Chapter 14

520-550

13

18-03-19

Debt and Taxes

Chapter 15

551-582

14

19-03-19

Financial Distress, Management Incentives and Information

Chapter 16

583-628

15

20-03-19

Payout Policy and Taxes

Chapter 17

629-647

16

21-03-19

Payout Policy vs retention rate

Chapter 17

647-670

17

25-03-19

The Adjusted Net Present Value

Chapter 18

672-691

18

27-03-19

Capital Budgeting and Valuation
with Leverage

Chapter 18

692-722

 

Teaching methods

Lessons and assignment based on Excel simulation

References

Berk J. and DeMarzo P. (2016), Corporate Finance – Global Edition, Pearson, ISBN 978-1292160160

During the course, all theoretical issues analysed during the course will be applied on real data with excel data simulation on real data

Slides and other material will be available on the course website.