DATE: 08/01/2011 BRIEF SUMMARY AND BACKGROUND INFORMATION Marriott initiated a financial reform process during the mid 1970s which was very successful in bringing the company back on a solid foot by 1980. The four year plan included steps to introduce fiscal discipline and maintain certain limits on debt to capital ratio, rating and fund raising activities. Also growth in hotel management fees and cash inflows from selling stakes in low return operations generated an excess amount of cash
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distinction between Marriott’s current capital structure and its target capital structure. Please answer the following questions in your write-up: 1. What is the WACC for the Marriott Corporation? Use the data in the case to estimate the risk free rate and market risk premium. 2. What would be the result if Marriott used the same single corporate hurdle rate to evaluate investment opportunities in all of its lines of business? 3. What discount rate should be applied to Marriott’s lodging
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Провести практический анализ решений компании * Сделать выводы по проделанной работе Постановка проблемы Компания “Marriott” считает, что ее акций существенно недооценены (на рынке торгуются по цене $19,625). В связи с этим компания планирует выкупить 10 млн. акций (из 32 млн. выпущенных). Однако, выкупать акции планирует по цене на $4 выше текущей рыночной. Описание компании Marriott Corporation была основа в 1927 году. Изначально, компания специализировалась на ресторанном бизнесе и предоставляла
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3035159109 liyao@connect.hku.hk LOU Chaoyue, Laura 3035236414 lauralou@hku.hk Catalog 1. Four components of Marriott’s financial strategies consistent with its growth objective ............... 1 2. The weighted average cost of capital for Marriott Corporation ...................................................... 2 (a) The risk free rate and risk premium to calculate the cost of equity. .......................................... 2 (b) Measurement of Marriott’s cost of debt .............
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Marriott Case Study 1)What is the weighted average cost of capital for Marriott? The weighted average cost of capital for Marriott is 11.64%. .4(cost of equity) + .6(cost of debt)(1- tax) Tax = Income tax/Income before tax = 175.9/398.9 = 44% Cost of debt = .5(.0895) + .4(.0872) + .25(.069) + .5(.011) + .4(.014) +.25(.018) = 11.25% B = 1.1 when d/e = .41 target d/e is .6 so.. B(a) = B(e) / (1 + (1-tax) D/E) = 1.11 / (1+.56(2499/3596)) = .80 B = .8 * (1+.56(5394/3596)) = 1.47
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Marriot case Analysis Lodging Division 1) Finding beta for Lodging: The nearest business that could be considered for calculating the beta is the Holiday Inn Corporation which has a beta of 1.35. In order to unlevered the beta of Holiday Inn Corp using; 1.35/(1+(1-t)*D/E); where t is the tax rate; D/E is debt to equity ratio. Therefore; 1.35/(1+0.56(0.74/0.26)) The unlevered Beta for Lodging is 0.435 which is approx. to 0.44. We can use the Holiday Inn Corp’s unlevered beta as an estimate
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Svetlana Como ACC 416 April 16, 2012 MARRIOTT INTERNATIONAL RESORTS, L.P., et al., Plaintiffs, v. THE UNITED STATES, Defendant In 1994, Marriott engaged in two short-sale transactions of U.S. Treasury securities with the intention of hedging its exposure to interest-rate risks related to a pool of fixed-rate mortgages that Marriott had obtained in the course of conducting its time-share business. As a result of these transactions, Marriott was obligated to return the securities involved at some
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Marriott International (Marriott) is global chain of hotels and lodging accommodations that are designed to fit varying needs and budgets. Marriott has several business units such as Marriott Hotels & Resorts, Courtyard by Marriott, Residents Inn, Fairfield Inn, and Marriott Vacation Club International. The commonality between all of the properties that Marriott International owns is that they all have a clear business-level strategy that allows them to focus on particular customer groups. Examples
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review…………………………………………………3 Analysis……………………………………………………….….6 Solutions……………………………………………………….…6 Reflection………………………………………………………..10 References…………………………………………………….…11 INTRODUCTION According to the 2014 sustainability report for Marriott International, the introductory remarks stated that, for a company to be a great leader in its industry, it has to possess a set of core values that inform every decision the company makes. Hence, Marriott’s core values have stood the test of time:
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and analyze Marriott Mobiles, mobile feedback system with respect to these characteristics. Characteristics Cost Time span Use of interviewer probes Ability to show concepts to respondent Management control over interview General data quality Ability to collect large amount of data Ability to handle complex questionnaires Mobile Feedback Low Fast No Yes N/A Moderate Low to moderate Low 2. What are some of the disadvantages of the mobile-based survey that Marriott created? This
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