Hudson Co: Valuation of a multi-national corporation
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Hudson Co., a U.S. firm, has a subsidiary in Mexico, where political risk has recently increased. Hudson's best guess of its future peso cash flows to be received has not changed. However, its valuation has declined as a result of the increase in political risk. Explain.
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This solution discusses the Hudson Co: Valuation of a multi-national corporation case. Political risk, future cash flow related to the peso, and valuation are discussed.
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The valuation changed as a result of political risk because political risk always brings financial uncertainty. While there has been no change in cash flows, the problem with ...
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