Archive
When evaluating an organization, one of the important decisions concerns the target leverage, which affects the WACC (Weighted Average Cost of Capital) and consequently the valuation outcome (naturally, […]
The optimal level of financial leverage is determined, on the one hand, by the amount of tax savings an organization receives by deducting interest expenses, and on the […]
The decision to pay dividends or repurchase shares impacts stock prices due to the expectations and signals such decisions create. Therefore, these decisions need to be systematic and […]
Financial theory tells us that there is an optimal capital structure derived from tax savings and the risks of financial leverage, but it says little about how to […]
The market views divestment positively as an event, even though management usually avoids such decisions. However, divestment does not always create value and can sometimes result in negative […]
Mergers and acquisitions can be executed either with cash or by transferring the shares of the new company. What is the difference? When the acquisition is done with […]
Managers often justify mergers and acquisitions by claiming that the operation is accretive, meaning that EPS (earnings per share) increases, and therefore shareholders should be satisfied. However, the […]
