Joe Smith argues that "learning how to do business analysis and valuation using financial statements is not very useful, unless you are interested in becoming a financial analyst.". Comment
Business analysis and valuation skills are useful not only for financial analysts but also for corporate managers and loan officers. Business analysis and valuation skills help corporate managers in several ways. First, by using business analysis for equity security valuation, corporate managers can assess whether the firm is properly valued by investors. With superior information on a firm's strategies, corporate managers can perform their own equity security analysis and compare their estimated "fundamental value" of the firm with the current market price of share. If the firm is not properly valued by outside investors, corporate managers can help investors to understand the firm's business strategy, accounting policies, and expected future performance, thereby ensuring that the stock price is not seriously undervalued.
Second, using business analysis for mergers and acquisitions, corporate managers (acquiring management) can identify a potential takeover target and assess how much value can be created through acquisition. Using business analysis, target management can also examine whether the acquirer's offer is a reasonable one.
Loan officers can also benefit from business analysis, using it to assess the borrowing firm's liquidity, solvency, and business risks. Business analysis techniques help loan officers to predict the likelihood of a borrowing firm's financial distress. Commercial bankers with business analysis skills can examine whether or not to extend a loan to the borrowing firm, how the loan should be structured, and how it should be priced.
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Claudia makes $30,000 a year. The median income for her state is $28,000. She owes over $50,000 in various debts and is considering ways to address her situation. Which of the following is not one of her options to fix her debt issues?
A. Chapter 7 bankruptcy. B. Attempt to negotiate a workout with her creditors. C. Chapter 13 bankruptcy. D. Pay off her loans.
If a marketing manager plans to enter newly industrializing-countries (NICs) or other Asia markets with a product that has proved to be successful in the home market, the product's diffusion processes are likely to be:
A) negligible since consumers will take time to assess the relative advantage. B) much slower than in the home market. C) much faster than in the home market. D) similar to that in the home market. E) less compatible in the Asian market.
An unsecured bond is the same as a
A) debenture bond. B) zero coupon bond. C) term bond. D) bond indenture.
The selection of data sources must be controlled by the research problem
Indicate whether the statement is true or false