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Wired for success - how Nos may optimize shareholder value with a different capital structure
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| 3.82 MB | Adobe PDF |
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Resumo(s)
The following Work Project consists of an Equity Research report on NOS SGPS S.A., one of
the largest telecommunications and media and entertainment companies operating in Portugal.
The report provides in an initial phase an in-depth overview of the company’s business model
and units, industries in which it operates, strategy and competitive positioning as well as an
analysis on the historical financial performance. Afterwards, a detailed valuation for each of the
company’s business segments was performed, from which the group issues a BUY
recommendation considering a calculated upside of 36.37%. The recommendation is
corroborated with other valuation methodologies used.
In the individual part, several tests were performed on the company’s capital structure for each
business unit to assess whether there would be an optimal capital structure with which the
company would be able to enhance shareholder value. The Modigliani and Miller theory under
perfect capital markets, the Modigliani and Miller theory with corporate taxes, and the trade-off
theory were reviewed and tested on the company. It was found that, as expected by the literature
considered, with a more levered capital structure, NOS SGPS S.A. would be able to increase
shareholder value with a calculated upside of 38.29%.
Descrição
Palavras-chave
Telecommunications Valuation Forecast Capital structure