FIN 522: Dollar general Case Study

Create an Excel workbook and word document to completely answer the questions for the case. Please no plagiarism, write answers in your own words. Be sure to complete the optional section!

Unformatted Attachment Preview

Don't use plagiarized sources. Get Your Custom Essay on
FIN 522: Dollar general Case Study
Just from $13/Page
Order Essay

FIN 522
Financial Administration
Assignment #4
Fall 2017
Valuation: General Dollar_bids_for_Family_Dollar
Completing this assignment is required. All assignments may be completed individually or by working
with ONE other person (see Assignment Write-up Guide for details).
Create an excel workbook and a word document that addresses the questions below, using the format of
the Assignment Write-up Guide. All case exhibits have been provided for you in Excel. Note that there is
an optional additional piece to this assignment.
Dollar General Case Questions.
Use the case exhibits unless instructed otherwise.
1. Project an EBITDA for Dollar General for the next financial reporting period (January 2016)
2. Calculate the Enterprise value to EBITDA ratio (EnV:EBITDA) for Dollar General (DG) using
your forecasted EBITDA and a Market Cap of $19.7 Billion (market value of the firm on
September 10, 2015). Calculate ?net cash? using the January 2015 reported Balance sheet items
for DG.
3. Forecast an EBITDA for Dollar Tree for the next reporting period (January 2016) assuming the
acquisition of Family Dollar does NOT occur. How does this value compare to the ~$13Billion
market cap that Dollar Tree was trading at before the merger. Use the short-cut valuation method
and use the EnV:EBITDA ratio you calculated for Dollar General (since they are in the same
industry) to calculate the Enterprise Value for Dollar Tree based on your 2016 forecasted
EBITDA value for Dollar Tree.
Optional. Doing this correctly will add up an additional 35 points to your Midterm Score.
1. Calculate a rigorous Free-Cash-Flow valuation of Equity Value of Dollar General based on the
exhibits provided
a. Have at least a 4-year explicit period
i. Justify the length of the explicit period
b. Calculate a terminal value
c. Discount using the industry average WACC of 7.22%
d. Use a long-term growth rate of 0%
e. Use a ?net cash? value from January 2015 reported Balance Sheet numbers (millions of
US Dollars) to convert your Enterprise value calculated by the FCF method to an Equity
Value (note that it is a negative value) for this case only.
f. How does this value compare to Dollar General?s market capitalization value of $19.7
Billion (as of September 10, 2015)?
i. Explain the variance
Fin522 / Faley / Fall 2017

Purchase answer to see full

Order a unique copy of this paper
(550 words)

Approximate price: $22

Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
The price is based on these factors:
Academic level
Number of pages

Order your essay today and save 15% with the discount code ESSAYHELP