The MCI Project What Message Is Mci Finance Essay

The MCI Project What Message Is Mci Finance Essay MCI would like to enhance Shareholder value by repurchasing outstanding stock, and send a bold signal to market and manager to stimulate the market price per stock to increase. A share buyback (by investing in themselves) instead of paying a cash dividend or, in other words, increasing a regular dividend, could represent an increase in the value of shares still available, this happens in the case that occurs a reduction in the number of shares of stock outstanding. If earnings remain the same but there is less shares outstanding, we can take for granted that the earnings per share might represent a positive NPV, or if the company reduces their number of shares outstanding, then they could increase earnings per share and also can raise the market value of the shares outstanding. However, if the company decides to authorize a repurchase of shares at the price of the book value per share, arguing that the shares are undervalued, then investors could buy those shares at a very low price. What will be the effects of issuing $2 billion of new debt and using the proceeds to repurchase shares on: MCIs shares outstanding? Assumptions: Shares repurchased at $28,92,Æ’Å“ then 69,16 million shares are going to be repurchased back, leaving 611,84 million shares outstanding. Shares repurchased at the current price of $27,75, Æ’Å“then 72,07 million shares can be repurchased and leaves 608,93 million shares outstanding. If there is no repurchase, then shares outstanding remain between 608,93 and 611,84 million (which are the shares outstanding if they were repurchased) as the repurchase price increases from $27,75 to $28,92 (at a Pre or Post repurchase share price). MCIs book value of equity? According to Exhibit 5: Total Current Liabilities = 4870 Long Term Debt = 3444+2000 = 5444 Deferred Taxes and Other = 1385 Stockholders Equity = 9602-2000 = 7602 Repurchase effect on leverage (using D/E ratio as a measurement, and assuming that D refers to Long-Term Debt): Pre D/E = 3444/9602 = 0,359 Post D/E= 5444/7602= 0,716Æ’Å ¸This is the increase of the Debt-Equity ratio to at least twice 36%. We have to remember that Phillips suggested that MCI would need to increase its Debt-Equity ratio from its current level of around 36% to at least twice that, even at that debt level the companys debt-to-cap would be moderate relative to the industry. Supposing that the debt of $2.000 million is Long-Term Debt (LTD); According to Exhibit 2: LTD/ BV (Book Value) of Pre Equity = 0,359 Then: BV of Pre Equity= LTD/0,359 = 3444/0,359 = 9593 BV of Post Equity= 9593* 609/681 = 8579 The price per share of MCI stock? New market Price= (New VOP Old Debt)/Old number of stocks = ($27.537,26 3.944) / 681= 28,8 These is the Data: Old debt 3944,00 new debt 5944,00 NEW VOP $ 23.537,26 oldà £Ã¢â€š ¬Ã¢â€š ¬n# of stock 681,00 new n# of stock 611,49 Old share mkt price $ 27,75 NEW MKT PRICE $ 28,77 old mkt cap. Equity 18897,75 new mkt cap.Equity 17593,26 FREE CASH FLOW 2714,21 Earnings per share? EPS= Net Income/ Shares Outstanding Assuming the EBIT keeps stable in 1996: Using the cost of debt of MCI shown in exhibit 3. Loan interest level BBB1 Phones based on the interest level of obligations of A1 Phones =((6,26+6,46)/2)= 6,36 Post EPS= (EBIT (Interest Expense + Debt* Cost of debt))*(1-Taxes)/Post Number of shares = (1118-(181+2000*6,36))*(1-0,4))/609 =485,88/609 = 0,80 Using Income statement of 1995 to get the interest rate: EPS= (Income before extraordinary item Debt *(Interest expense/Long Term debt)*Taxes)/Post Number of shares EPS= ($573 $2000 * ($181/$3444) *0,4)/609= 0,87 Using the estimated EPS in exhibit 2: EPS= Net Income / Outstanding = (Estimated 1996 Year End EPS * Outstanding debt* i * (1-T))/ A- outstanding = (1,75 * 681 2000 * 6,36% * (1-0,04))/609 = 1,83 What is MCIs current (pre repurchase) weighted average cost of capital (WACC)? MCIS current WACC =11,88% (See Excel Sheets for explanation) What would you expect to happen to MCIs WACC if it issues $2 billion in debt and uses the proceeds to repurchase shares? If MCI issues $2 billion in debt and uses the proceeds to repurchase share, the cost of equity will increase and the WACC is expected to decrease. The higher WACC is due to the higher leverage ratio. In the MCI case, the market value WACC will be decreased from its original 11.88% to 11.53%, it also have higher value of cooperation, the increased value of the firm makes the stock price going higher level. The following table shows the relationship between corporatevalues of the firm versus WACC. Would you recommend that MCI increase its use of debt? If so, by how much? Yes, it is recommended. From the below sensitivity test, we can see that the optimal WACC is about 10.79% which means 42.25% debt ratio and 57.75 equity ratio. The debit required is 6381.83million, and the book value of corporate will be increased to 14213.42million. Therefore I suggest MCI issue 2.437billion dollars to increase its debt/equity level and maximize the value and stock price. By old Book value after debt T 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% 40.00% RPm 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% 7.00% Rrf 5.70% 5.70% 5.70% 5.70% 5.70% 5.70% 5.70% 5.70% 5.70% wd 0.00% 17.27% 20.00% 25.00% 29.12% 35.00% 42.25% 44.90% 45.00% ws 100.00% 82.73% 80.00% 75.00% 70.88% 65.00% 57.75% 55.10% 55.00% D/E 0.00% 20.87% 25.00% 33.33% 41.07% 53.85% 73.17% 81.49% 81.82% Rd 6.03% 6.30% 6.30% 6.30% 6.30% 7.09% 7.09% 7.09% 8.26% bU 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 1.00 bL 1.00 1.13 1.15 1.20 1.25 1.32 1.44 1.49 1.49 Rs 12.70% 13.57% 13.75% 14.10% 14.42% 14.96% 15.77% 16.12% 16.13% wacc 12.70% 11.88% 11.75% 11.52% 11.32% 11.21% 10.90% 10.79% 11.10% Corporate Value 12080.78 12908.83 13050.45 13317.68 13546.00 13680.91 14067.11 14213.42 13814.48 Debt 0.00 2228.90 2610.09 3329.42 3944.00 4788.32 5944.00 6381.83 6216.51

Suffrage Movement during the Progressive Era

During the late 1800's and early 1900's women's lives were consumed with fighting for what they should have always had; equality. This fight for fairness is the main driving force behind the Progressive Era. Women were coming together all over the country in a unified fight for women's rights. This massive change had been silently building up in the background for many years prior to 1900 but it is here that we see the biggest changes. Women moving from the homes and houses to the factories and commercial sites. There are other significant changes taking place as well. Women became much more involved in politics even though they could still not vote in public elections. This change in the thoughts and lives of women is one of the main focus of the 20th century and the reason for our 19th amendment. During the Progressive Era the roles of women were changing dramatically due to a number of reasons, but most importantly to the efforts of clubwomen. In 1890 women founded The General Federation of Women's Clubs (GFWC). This was a major step for women's rights advocates as it established a major political presence in the country. The formation of the GFWC represented the changing roles of women in the political world. Many women felt they were being oppressed and wanted change. â€Å"Violence against women is part of a continuum of sexist power relationships which define our roles in the home, workplace & society. Inequality, poverty & alienation spawn further violence & make women more fearful†¦ which in turn causes them to limit their right to participate fully in city life. † -1988 -â€Å"The Safe City† METRAC, Metro Action on Public Violence Against Women & Children, Toronto. The women of the GFWC rallied to support women all over the country and they fought for equality on almost every political front. The creation of the GFWC started a women's movement towards the clubwoman ideal. They were now beginning to move away from their roles as caregivers and housewives towards more industry oriented positions. Progressive women began to create clubs which supported many different causes such as temperance and better working conditions. The most affluent of these clubs was the Woman's Christian Temperance Union. The WCTU led the way with women's rights and allowed women to voice their fears about home abuse as well as legal rights. Drawing from all over the country the WCTU gained much of its support from the middle-class women of the 1900's. By allowing these women to voice their thoughts and fears these clubs became very powerful tools in the political arena. The WCTU consisted of over 39 different departments dealing with everything from labor restructuring, lobbying, and public affairs, to health, education, and peace. By the 1890's the WCTU had over 150,000 members and over one million by the 20th century. The WCTU was important to white southern women in particular. These southern women were the most need in change due to a common southern idyllic that the woman should be a model of the family and should not be subjected to the harsh world outside the home. This act of keeping the women inside the home all day caused much resentment from the woman and led many women to join the WCTU. These women gradually became active working women and many left their abusive husbands in search of better living standards. Women's lives in the home also changed a great deal. In the 1890's Catharine Beecher began to publicize her ideas on housework. She believed that it was possible to â€Å"professionalize† housework. As the first female to graduate from MIT she held a great deal of authority. Her ideas were received with mild success. She tried to blend technology, housework, and science together to create a better picture of the importance of women. The main result of this change was that it made women realize that they were more than a status symbol. A Major cause of the changing roles in the home was that women found themselves not able to join some new professions. Officially excluded from the politics of men during much of Canada's history†¦ , Canadian women have had their own politics. † â€Å"Who were these women who were willing to sacrifice the relative comforts of home, & the frequently permanent parting from family & friends†¦ most of them must have found their lives enormously changed†¦ but they adapted to new ways of doing things. † -1988. – Prentice, Bourne, Cuthbert Brandt, Light, Mitchinson, Black They were unable to hold even some of the most unwanted jobs such as janitors and delivery persons. Women were also restricted from voting. Their input was unimportant in both national and even local elections and this made them angry. Women could not hold public offices and were, for the most part, restricted from seizing any adequate amount of power. At the time many men believed women should not hold any power and that they were unsuited for work outside the home. This belief was so strong in certain areas that women had even believed it for a time. Soon women began to become educated. Many colleges were beginning to allow women, both black and white, to attend. Reasons include financial stability, public outlook and support, but most importantly the efforts of women like Susan B. Anthony, Jane Addams, Marion Talbot, Mary Church Terrell, and a number of other courageous women. Through the suffrage movement many women were allowed to receive a higher education. Education was originally only for men but women soon fought that tradition and many colleges began to allow women into classes. Women soon began to challenge their places in society as well as their roles and both mothers and as part of the workforce. Because they stood up to the resistance slowly jobs were beginning to open up. There were many visible signs of women's changing roles. In the home they no longer looked after children as much as they used to. They were out getting jobs and didn't have the time to commit themselves to the children's upbringing. They were also very much more involved in politics than ever before. Women wanted a voice and they were willing to fight for it. They did this by forming clubs and joining in many different movements. Many women felt they should become more involved in the community through clubs and politics and many wanted to expand their realm of control. These women had once been situated mostly in the home but were beginning to challenge this idea. Some women liked the idea of clubs and unions because it allowed them to challenge the norm without sacrificing themselves completely. They believed it was necessary for the removal of the age old gender distinctions. The biggest affect that clubs had on women was their ability to bring all the middle-class women together. This was such an amazing feat that it was hard for male politicians to challenge them. Women began to take control of the finances more than they had in the past. They were bringing in income and felt that they should therefore be allowed to have a say in the finances. They were also more educated and as such believed they were capable of taking care of the finances. Another area that women's lives were changing in was that of relationships. At one time women's lives were controlled almost completely by men. The women had little say in anything and could not object to what the husband believed was right. Women were so restricted that they could not speak out even in cases of abuse. Being unable to object to their husbands caused a great deal of resentment and hurt the family's relationship. â€Å"There are two general divisions to this subject of Equal Franchise. Is Woman Suffrage just and right? Is it expedient and desirable? I think an affirmative answer may be taken as granted all round. If it is admitted that Government is a human concern and that woman is just as human as man, all the rest follows. The fact that woman is different from man mentally and morally as well as physically is not an argument against her enfranchisement, but, in a representative system, a conclusive argument for it†¦. No man, without woman's co-operation can make a real home. Look at the conditions: Countries that are nominally free being made the prey of monopoly, privileges and injustice, with such evil fruits as the liquor traffic, white slavery, child labor and abject poverty side by side with unimaginable wealth. Man has been a failure as a housekeeper, and it is high time that he took an equal partner — the natural partner he should have had from the first†¦. The infusion of woman's keener moral perceptions and stronger spiritual ardor into statesmanship is what is needed to meet the perils of the day, and to bring the triumph of the Cause of Peace by securing the triumph of the Cause of Justice. † Woman Suffrage, By J. W. Bengough (1922) http://www. adams. edu/academics/art_letters/hgp/civ/111/5suffragequotes. html This was all beginning to change as women gained a voice and financial independence they also obtained the ability to divorce their husbands and discard earlier beliefs that women were showpieces. Women are persons in matters of pains and penalties, but are not persons in matters of rights and privileges. † (1876 British Common Law ruling). This was overturned by the 18 Oct. 1929 Person's Case. When women won, Nellie McClung said â€Å"Ladies, hang Lord Sankey's picture on the wall of the Community Rest Room with Newton Wesley Rowell's beside it, & let these names & the names of the other Lords of the Judicial Com mittee of the Privy Council be kept in perpetual and grateful remembrance†¦ † The Progressive Era is known for many achievements, but most importantly for how it helped to shape the world we live in today. Women's lives have changed dramatically since the late 1800's. Women were once treated unequally both in the home and in the workplace. They were unrepresented in politics as well. Women had to face many hardships during their fight for equality and much of this fighting began during the Progressive Era (1890-1920). Both in the home and in politics the lives and lifestyles of women have greatly improved. Women who once had no voice now were becoming clubwomen and voting on behalf of their parties. Women who were once confined to the role of housewife could now begin to seek financial stability in jobs such as nursing and textiles. Women's lives were far from equal to that of men but the steps taken during the 1900's ensured that they would forever fight until that uniformity was established. There were many times when women struggled to gain equality, but none as important or as far reaching as the women's rights movement of the Progressive Era.

Into the World Billy Elliot Essay

The life stage of entering a new world is crucial for oneself, in requiring an individual to adopt optimistic branches in a plethora of life aspects. This perception is successfully conveyed through Stephen Daldry’s 2000 drama motion picture, Billy Elliot, and is assisted by the director’s application of the tools of film production. In enhancing the perspective communicated through J. C. Burke’s 2005 Australian novel, The Story Of Tom Brennan, the film clearly demonstrates the benefits of moving into the world. The composer applies metaphorical mise-en-scene in establishing the notion that the lack of progressive connections forms barriers from entering a new world. The issue of family breakdown is communicated through Daldry’s use of the kitchen’s mise-en-scene where Mrs Wilkinson and Tony Elliot argue. The confined placement of objects, as well as low lighting, forms an overwhelming atmosphere, shaping the hardships faced by these shattered relationships. This is also delivered through Daldry’s motif of a brick wall that metaphorically encloses Billy from venturing into the world. As Billy Elliot lacks a female role model, he is faced with barriers such as violence, which lowers both self-esteem, and optimistic perceptions. Likewise, this complements the character of Theresa Brennan and Burke’s notion that one must develop strong relationships in order to venture into the world. Constructing positive relationships and renewing one’s sense of self is central in the phases of metamorphosing into the world, as supported by Daldry’s use of camera shots and symbolism. A constantly progressive process of entering the world is supported by Daldry’s long shots of roads and bridges, which enhance the idea of travelling forward. This is linked to The Story Of Tom Brennan and Tom’s constructive relationship with Brendan, as seen through his matured response in discovering the homosexuality of his uncle. The effective use of symbolism communicates a growth in character development, in contrasting the end results of the sub-journeys. The pathetic fallacy of rain, snow and clouds illustrates a strangling vibe that barricades Billy from entering the world, as a result of self-doubt, a lack of identity, and a lack of role models. This contrasts to the cross shots of Billy Elliot’s confident body language through dancing and breaking through doors, as well as the low angle shots of Billy ascending stairs, metaphorically into a new world. A final stage of entering the world is confirmed through Daldry’s layered long shot of Billy and his father walking down a path, which leads towards an oceanic horizon. This complements the intimate, final moments of The Story Of Tom Brennan, in which Tom admits to have found himself through his relationship with Chrissy, as juxtaposed to his first, adverse impression of moving into the new town of Coghill. Stephen Daldry is shown to successfully convey the process of venturing into the world, in elaborating on the progression of self and multiple bonds. By effectively applying the elements of cinematography, in a metaphorical manner, the director both enhances and complements the developing vibe, as communicated in J. C. Burke’s novel, The Story Of Tom Brennan. For one to enter a new world, it is therefore communicated that one must adopt affirmative perceptions of their present world.

Taking English 1010 Was A Great Experience - 924 Words

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