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FIN 608 Assignment




Question;BACKGROUND FOR PAPER:Legal Name of Company ? Molson Coors Brewing CompanyTicker Symbol ? TAPFiscal Year End ? December 31Financial Reporting Framework ? U.S. GAAPOpinion on Financials by Auditors ? Unqualified for Year Ending December 29, 2012Brief Description of Company?s Business Activities ? Molson Coors Brewing Companyis a manufacturer and distributer of beer and other beverage products. The company sellsits products under various labels (i.e. Coors, Miller, Molson, Rickard?s, Carling, etc.) andis licensed to brew and distribute under other labels (i.e. Heineken, Amstel, Foster?s,Cobra, etc.).REQUIRED SOURCES:1) Thomson ONE Business School Edition- Value Line Investment Survey. Use both the company and industry pages. If youdon?t know how to use this service, visit: As far as where to find the financial statements, they can be found on the Molsoncoors website and also from the SEC website: ASSIGNMENT:1. Using Thomson ONE Business School Edition download ten years of stock price andmarket index information. Use Excel?s ?Slope? function to estimate a beta with thesedata. Next, using Value Line find an estimate of the company?s beta.a. Try to think of reasons why your beta estimate would be different than that ofValueLine.b. Explain, what the figure you found (don?t forget to give credit) tells you aboutthe company?s risk. Is the beta positive or negative?i. If negative, is it smaller or larger than -1.0?ii. If positive, is it smaller or larger than 1.0?2. Quality of Earnings: The value of a stock depends among other things on the incomethat the company generates in future periods. (E.g. P/E ratio, NOPAT in corporatevaluation method.) Compare the income for each of the three years presented in thefinancial statements. Are there any non-recurring items, such as adjustments forchanges in accounting methods or estimates, changes in valuation allowances,extraordinary gains/losses or income/losses from discontinuing operations that shouldbe excluded from an estimate of future income or cash flows from this company? Canyou develop an estimate of recurring income from operations?3. Calculate the company?s Free Cash Flow and compare it to the total dividends paid inthe most recent year. Explain how and why you calculated NOPAT the way you did.Could the company increase dividends? Why or why not?a. To do this you must first estimate your company?s tax rate by comparing pretaxincome to income tax expense and rounding this number. If your company hasa loss, you may have to make an assumption regarding carry backs or carryforwards. If you assume a carryback is done, you may want to look at previousyears incomes to see, if you have something to carryback to.


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