CORPORATE FINANCE CASE STUDY

You should prepare a written case report. As for the first case, you should structure your case report as an executive-style memorandum, which contains the following components (in that order):

• Executive summary (one page at most) and Your analysis and recommendations (the bulk of your write-up)

Please ensure you answer the questions given below in your report. The Executive Summary should focus primarily on questions 3 and 4.

3) Which of the five CPRs should Doug Scovanner accept? Explain how the following influenced your decision (assume Target has an unlimited capital budget):

a) NPV and IRR

b) Size of project

c) Cannibalization of other stores’ sales

d) Store sensitivities e) Variance to prototype f) Customer demographics g) Brand-awareness impact Discuss your rationale as to why each store project should be accepted or rejected. You should be able to thoroughly analyze each store’s Capital Project Request Dashboard. Please ensure you clearly state whether you would accept or reject each of the five projects. Finance 3504 Intermediate Corporate Finance © 2017 Pavel G. Savor

4) If Target’s capital spending budget for store expansion was limited to $120 million, which CPRs would you accept? Provide arguments supporting your answer.

 
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