Nike Case Study and Excel

Can you do the Nike Case Study with excel? I’ve uploaded the instructions and the excel that needs to be used. Also, the next must have “=” with formula, NOT just the number entered. 

Please let me know because it is due this week. 

Individual Assignment – Nike Case Write-Up
Mergers & Acquisitions

The Nike Case Study is intended to serve as an introduction to the calculation of the Weighted-
Average Cost of Capital (WACC) of the firm.

The case provides a WACC calculation that contains errors based on conceptual
misunderstandings. Students will identify and explain the mistakes in the analysis. The case
assumes that students have been exposed to the WACC, CAPM, the dividend discount model,
and the earnings capitalization model.

Complete the Nike Case Study reading (found in the Readings and Course Materials folder).

Put yourself in the role of one of the stakeholders in the case and reflect on the information in
the document. Make sure to address the following items:

1. What is the WACC and why is it important to estimate a firm’s cost of capital? [2 to 3
sentences max.]

2. Calculate your own WACC for Nike. Note the following requirements:
a. Calculate the Cost of Debt based on the information provided in the case. [Fill in

the highlighted Excel cells; explain your calculation briefly]
b. When you are calculating the Cost of Equity, do it under three different

scenarios:
i. CAPM [Fill in Excel file]
ii. Dividend Discount Model [Fill in Excel file]
iii. Earnings Capitalization method [Fill in Excel file]

c. Summarize what the WACC would be in 3 different scenarios: using the Cost of
Debt and three different Cost of Equity percentages.

3. Highlight/note any differences versus Joanna Cohen’s calculation.
4. Which of your three WACC calculations (based on the 3 different Costs of Equity) do

you think makes the most sense and why?

You should have the following section in your final submission. They should look something like
this:

1. What is your WACC and Why is it Important?
Your answer…

2. WACC Calculations

A Summary of your findings. You will submit the Excel file separately.

3. Differences vs. Joanna Cohen
Your answer…

4. WACC Recommendation

Your answer….

Students will submit the filled out provided Excel file (answering the highlighted cells), and their
write-up by the due date. The write-up should be brief and organized to answer the questions
listed in section II. It should be 2 pages maximum, double-spaced, with Calibri (12 pt). This
assignment should also have a cover page with:

• Your name
• The course number/name
• Your instructor’s name

Rubric
This is an individual assignment and accounts for 5% of your overall grade. You will be
assessed according to the following rubric.

Superior

High
Quality

Average Below
Average

Poor

Formatting and Creativity – Student
correctly incorporates all formatting
requirements. Student identifies a role in
the case and analyzes the case from that
perspective; i.e. the student “owns” the
case.

10 – 9 pts 8 pts 7 pts 6 pts 5 – 0 pts

Part A – Student defines WACC and
effectively communicates its importance in
estimating a firm’s cost of capital.

5 pts 4 pts 3 pts 2 pts 1 pt

Part B – Calculates correct answer for part 1
and includes all supporting calculations;
calculates answers for part 2 and includes
all supporting calculations.

10 – 9 pts 8 pts 7 pts 6 pts 5 – 0 pts

Part C – Identify obvious errors and explain. 5 pts 4 pts 3 pts 2 pts 1 pt

Part D – Justifies selection of WACC
calculation and provides rational analysis

10 – 9 pts 8 pts 7 pts 6 pts 5 – 0 pts

Clarity and Mechanics – Writing is free of
grammatical and spelling errors.
Writing style communicates ideas clearly.

10 – 9 pts 8 pts 7 pts 6 pts 5 – 0 pts

Introduction (Objective of the Assignment)
Assignment Requirements
Assignment Format

Appendex A

(PRE tax)

of Debt

<--- show formula, not a hard-coded number

Using: (show explain assumptions for all in write up)

exhibit 4 has options

Cost of Equity 0.00%

After-Tax Cost

0.00%

Sheet2

Sheet3