mercury athletic footwear sensitivity analysis
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mercury athletic footwear sensitivity analysis

mercury athletic footwear sensitivity analysis

Athletic Footwear Market size was USD 80 billion in 2015 and is forecast to grow at approximately 3% CAGR from 2016 to 2023. 4050 SEPTEMBER 18, 2009 TIMOTHY A. LUEHRMAN JOEL L. HEILPRIN Mercury Athletic Footwear: Valuing the Opportunity In March 2007, John Liedtke, the head of business development for Active Gear, Inc., a privately held footwear company, was contemplating an acquisition opportunity. 4 a. Estimation of the weighted average cost of capital 5 b. AGI Mercury Athletic Footwear $470.3 Million Sales Revenue in 2006 42% Revenue - Athletic Footwear 58% Revenue - Casual Footwear Among the best profit margins in the Industry Prosperous, Active, and Fashion-Conscious Brand Image. As a global fashion industry and retail expert, he supports clients on a broad range of strategic and top management topics, as well as on operations and sourcing- related issues. The rise in the market value can be attributed to rising health awareness, changing consumer lifestyle and technological advancements. The company also offers other products such as sports equipment and accessories. Strong Brand Awareness – Nike is one of the most recognizable brands in the world as its name alone is memorable, easy to pronounce, and very unique. In the United States, athletic footwear sales grew by 8%, reaching a total of $17.2 billion. The average selling price of sneakers grew by 5% in 2015, reaching an average unit cost to the customer of $61.15. Estimation the value of Mercury based on discounted cash flows and Liedtke’s base case projections. Mercury Athletic Footwear Case Solution,Mercury Athletic Footwear Case Analysis, Mercury Athletic Footwear Case Study Solution, QUESTION 1 If we look at the valuation of Mercury for the part D and part F, then a difference could be seen between the enterprise values. Mercury Athletic Case. 3 million in revenue in 2006, making it relatively small compared to big players in the athletic and casual footwear industry. Mercury Athletic Footwear: Valuing the Opportunity 3861 Words | 16 Pages. Mercury Athletic: Valuing the Opportunity Case Solution, This Case is about FINANCIAL ANALYSIS, MERGERS & ACQUISITIONS PUBLICATION DATE: September 18, 2009 PRODUCT #: 4050-PDF-ENG When pupils have the English This paper covers an economic analysis of Nike, and analyzes different economic aspects of the firm. Mercury athletic footwear Group 7 Contents Executive Summary & Overview of Problems 3 Analysis on Mercury acquisition 4 1. Format: Print | Language: English ShareBar. Mercury Athletic Footwear. Global Athletic Footwear Market is expected to reach $114.8 billion by 2022, growing at a CAGR of 2.1% during the forecast period 2016 - 2022. The case uses the potential acquisition of Mercury Athletic as a vehicle to teach students basic DCF (discounted cash flow) valuation using the weighted average cost of capital (WACC). Revenue growth . In the first excess free cash flow analysis ran for Mercury Athletic Footwear, as can be seen in Exhibit 1, we used the assumptions given by Liedtke. Mercury Athletic Footwear Case Solution. Its swoosh symbol is easily recognized by everyone. Mercury Athletic Footwear Case DCF VALUATION ANALYSIS Jianqiu … Is Mercury an Appropriate Target for AGI? View Notes - Mercury Athletic Footwear Case File from FIN 555 at DePaul University. Nike has captured approx. Due to strategy reorganization, WCF wanted to shed this segment. (Forbes) #3. 79% Athletic 21% Casual. Mercury Athletic Footwear: Valuing the Opportunity Case Study Solution & Analysis Why Almost Everything You’ve Learned About Mercury Athletic Footwear: Valuing the Opportunity Case Solution Ideas Is Wrong and What You Should Know. Amongst the procedur Should AGI purchase Mercury? Mercury Athletic Footwear Case Study Analysis is really simple to comprehend it's centered on creating content that can be readily discovered by leading search engines such as Google, Yahoo, and Bing. Majo Estimation the value of Mercury based on discounted cash flows and Liedtke’s base case projections. Global shipments were over 3.5 billion units in 2015. View Mercury Athletic Footwear Case from BUFN 750 at University of Maryland, College Park. 31% of the global athletic footwear market. Opinion & Analysis Jan 12, 2019 9:00AM PT Why Shoe Production May Never Come Back to the US . It was estimated in 2017, that the apparel market grew by approximately 5.46 percent compared to the previous year, with an expected peak growth rate of around 6.2 percent in 2020. Economics Analysis of Nike Abstract Nike leads the market of athletic footwear and apparel. Always be ready to take total benefit of the stream of ideas as soon as it starts to gush. Samantha McDonald. Mercury Athletic Footwear, Inc.: Valuing the Opportunity: Brief Case No. The last page of the Mercury Athletic case mentions at least two possible sources of value creation not captured in Liedtke’s base case scenario: a significant reduction in Mercury’s days sales in inventory (DSI) and a possible combination of Mercury’s and … ACTIVE GEAR COST OF CAPITAL ASSUMPTION Tax Rate Cost of Debt Risk Free Rate Expected Market Return Market Risk Premium Asset ?eta Debt-to-Value Ratio Debt-to-Equity Ratio Equity Beta 40.0% 6.00% 4.93% 10.43% 5.50% 20.0% 25.0% 0.970 By: Timothy A. Luehrman and Joel L. Heilprin. 12.5%. MGMT S-2720 Assignment 1: Mercury Athletic Footwear Questions Mercury Athletic Footwear 2 Harvard Case Study Solution and Analysis of Harvard Business Case Studies Solutions – Assignment HelpIn most courses studied at Harvard Business schools, students are provided with a case study. Mercury Athletic: Valuing the Opportunity Case Solution,Mercury Athletic: Valuing the Opportunity Case Analysis, Mercury Athletic: Valuing the Opportunity Case Study Solution, When pupils have the English language PDF of this Brief Case in a coursepack, they are going to … clothing, textiles, footwear, athletic wear, beauty, accessories and retailers spanning from the value end to luxury. More Stories … Abstract. Mercury Athletic is the footwear division of West Coast Fashions (WCF), a designer and distributer of branded athletic and casual footwear, targeted at youth market. 2% to 6%. $431,121mn % Revenue Product wise. Mercury Athletic Footwear – Acquisition Analysis. 42% Athletic 58% Casual. Mercury Potential to double revenues Increase leverage with manufacturers Increase long run growth rate Expand presence with key retailers and distributors. Key players include Puma, Nike, Gap Inc., The athletic footwear market incorporates sportswear, trekking shoes, aerobics shoes, walking shoes, and running shoes. Mercury Athletic Footwear  Mercury Athletic Case Nicholas Thebeau, Student ID 50927830 Presented to: Professor Kevin Wall West Coast Fashions, Inc. (WCF), a large designer and marketer of men’s and women’s branded apparel recently announced plans for a strategic reorganization Active Gear, Inc. (AG), a privately held footwear company, was contemplating an acquisition opportunity. $60.4mn. C I T E L Y H T AT T U N I : Y R R O R P A P U EE O C R H E TW T M OI N G FOA L U V RECOMMENDED VALUE Range of Athletic footwear refers to those shoes that are designed for sports and other outdoor activities. (Forbes) #2. By Samantha McDonald. $470,285mn. Reasons why Mercury is an appropriate target for AGI 4 2. Nike Inc. enjoys a top position in the global athletic shoes, equipment and apparel market. The market is expected to grow annually by 9.6% (CAGR 2020-2025). India: Revenue in the Footwear market is projected to reach US$7,923m in 2020. Liedtke assumed that Mercury’s women’s casual footwear would be wound down within one year following an acquisition. A Five Forces Analysis, based on Michael Porter’s model, points out that competition, customers and substitutes are the most important external forces in Nike’s industry environment. Athletic Footwear Market Overview. Active Gear was one of the most successful firms in terms of profitability, in the footwear industry. MERCURY ATHLETIC FOOTWEARProblem statement:West Coast Fashions, Inc a large business of men’s and women’s apparel decided todispose of one of their segments; Mercury Athletic. In order to summarize, due to AGI’s small size, there is a strong risk of being overtaken by the other giant players in the market therefore, if it acquires Mercury, the risk will be minimized and there is a strong opportunity that the company will grow steadily. Just three companies (Nike, Adidas, and Under Armour) account for more than $25 billion in sneaker sales each year. Reasons why Mercury is an appropriate target for AGI 4 2. Revenue. $42,299mn. An outstanding content it can constantly work in drive optimum traffic to your website causing development in organisation in 2018. Athleisure Market size was valued at $155.2 billion in 2018 & to reach $257.1 billion by 2026, with a CAGR of 6.7%. 4050. Market Analysis: Global Athletic Footwear Market Global athletic footwear market is expected to rise to an estimated value of USD 96.10 billion by 2026, registering a steady CAGR in the forecast period of 2019-2026. Active Gear, Inc. is a privately held footwear company with $470. -Founded in 1968 by Daniel Fiore -Producer, designer and distributor of branded athletic and Mercury Athletic Footwear Case Solution, Analysis & Case Study Help Mercury Athletic Footwear Case Solution Testimonials basic procedures for estimating terminal price inside the valuation of companies. Academic writing is getting a service in itself. Mercury Athletic Footwear - Acquisition Analysis ACTIVE GEAR COST OF CAPITAL ASSUMPTION Tax Rate Cost of Debt Risk Free Rate Expected Market Return Market Risk Premium Asset βeta Debt-to-Value Ratio Debt-to-Equity Ratio Equity Beta 40.0% 6.00% 4.93% 10.43% 5.50% 20.0% 25.0% 0.970 CASH FLOW AND OPERATING ASSUMPTIONS Mercury athletic footwear Group 7 Contents Executive Summary & Overview of Problems 3 Analysis on Mercury acquisition 4 1. Operating Income. Nike’s Strengths – Internal Strategic Factors. By: Timothy a. Luehrman and Joel L. 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