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2014 Brooks case competition. Lavaniah Mohan Zi Jian Saw Yee Shan Lee. Introduction. Decision Supporting ideas Qualitative discussions . I. Decision. Not investing in the stock NPV Sensitivity analysis Sensitive to sales Appendix 1: Best Estimate
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2014 Brooks case competition Lavaniah Mohan ZiJian Saw Yee Shan Lee
Introduction • Decision • Supporting ideas • Qualitative discussions
I. Decision • Not investing in the stock • NPV • Sensitivity analysis • Sensitive to sales • Appendix 1: Best Estimate • Appendix 1a: Best Case Scenario • Appendix 1b : Worst Case Scenario
II. Analysis • Retrospective Analysis • Current Ratio • Quick Ratio • Profit Margin • Gross Profit Margin • Return on Total Asset • Return on Total Equity
II. Intrinsic Value Analysis • First Approach • Total Shareholders’ Equity / Shares Outstanding • Second Approach • Estimate for year 2012 using FCF approach • Results - overvalued
III. Qualitative Discussion • New Pricing Strategy • Everyday Pricing • Monthly Specials • Clearance Sales
III. Qualitative Discussion • Suggestions for the remodeling process • Retailer and Manufacturer Approach • Store-within-a-store arrangement • Retailer-resell arrangement • Customer Services • Loyal member card
III. Impact of Competitors • Lose Bargaining Power • Substitutable products • Inter store Competition • Competitors’ Experience
IV. Conclusion • Not buying stock • Sensitivity to sales • Intrinsic value < market price • Ineffective pricing strategy • Competitors