Marriott Cost of Capital

Marriott Cost of Capital Case Study Company compose The Marriott dope is a global real e orb conglomerate with more than 3,400 properties in 70 countries and territories. It successfully manages tether major business sector divisions: lodging, restaurants, and contract services. The overall material object of the community is to remain the leaders provider in the hospitality industry by having a competitive favor over its competitors through innovation and state of the art customer service. To successfully achieve its business targets and wrap up prodigious financial growth, the political partys corporate enterprisingness foc enforces on four components of its financial strategy: (1) manage or else than own assets, (2) invest in projects that increase shareholder value, (3) perfect the use of debt in the slap-up structure, and (4) repurchase undervalued shares. Cost of Capital The objective of this case study is to demonstrate the u se of the economic meditation of asset pricing (CAPM) and the cost of financial jacket (WACC) to casting how it can be used in the firm to deem the required return for real investments based off of company specific data. Marriott uses the weighted number cost of capital (i.e.

spring rates) to determine its cost of capital on investments and to in effect run business operations. By calculating the weighted amount cost of capital and the cost of capital for the lodging and restaurant division, the company will be able to analyze the divers(prenominal) impartiality and debt positions of each division and provide recommendations on how to push ki! ll the companys WACC. Understanding the companys WACC is intrinsic to the success of the business because it is a key component in determining the companys stock valuation and is to a fault a tool used to help the company with capital budgeting analysis as well as several disparate applications. Marriott measured the opportunity cost of capital for investments of similar recumb on the line using the weighted average cost...If you indispensability to get a full essay, order it on our website: BestEssayCheap.com

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