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Value of AT&T

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Bonds
1. Using AT&T (NYSE: T) http://finance.yahoo.com/q?s=t, discuss and analyze the firm's outstanding bond issues.
WACC
2. Using AT&T, collect the following information:

a. Cost of debt, yield to maturity on bonds and the firm's tax rate.

b. Cost of preferred stock, if any, computed using the dividend approach.

c. Cost of equity computed using the dividend growth model or CAPM.

d. Proportion or weight of debt in the capital structure of the firm.

e. Proportion or weight of preferred stock, if any, in the capital structure

f. Proportion of common equity in the capital structure.

Then compute the WACC.

Firm value

3. Now, calculate the value of AT&T using the Corporate Valuation Model by collecting the
Free Cash Flows (FCF), Free Cash Flows growth rate (g), and using the Cost of capital (WACC) computed above.

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See attached.

Bonds
1. Using AT&T (NYSE: T) http://finance.yahoo.com/q?s=t, discuss and analyze the firm's outstanding bond issues.
WACC
2. Using AT&T, collect the following information:

a. Cost of debt, yield to maturity on bonds and the firm's tax rate.

b. Cost of preferred stock, if any, computed using the ...

Solution Summary

This provides the steps to calculate the Value of AT&T, Free Cash Flows (FCF), Free Cash Flows growth rate (g) and Cost of capital

$2.19
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Value Chain Analysis for AT&T

Value Chain Analysis for AT&T
Explain the value chain analysis for the business that includes the customer. Value chain analysis describes the activities that take place in a business and relates them to an analysis of the competitive strength of the company. Value chain activities can be grouped into two categories.
? Primary Activities - Those that are primarily concerned with creating and delivering a product (e.g. component assembly)
? Support Activities - Activities (e.g., human resource management) that might increase effectiveness or efficiency

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