StudentShare
Contact Us
Sign In / Sign Up for FREE
Search
Go to advanced search...

Financial Management - Essay Example

Cite this document
Summary
Listed in the London Stock Exchange (Symbol: SBRY), it is the parent company of Sainsbury Supermarkets Ltd, a chain of supermarkets in the UK. It…
Download full paper File format: .doc, available for editing
GRAB THE BEST PAPER92.3% of users find it useful
Financial Management
Read Text Preview

Extract of sample "Financial Management"

Download file to see previous pages

The companys fortunes have improved since the launch of a recovery programme by CEO Justin King in 2004. It is apparently closing in on ASDA with its improving market share of 16.22 per cent (ASDA:16.6 per cent). One of the three leading distributors of consumer goods in the UK, the Sainsbury group runs 350 supermarkets and 300 shops branded Sainsburys Local and Bells Stores, offering a range of articles from food to health care products, of which under half are sold under the companys own brand.

The company also owns real estate and a bank, Sainsburys Bank, which offers such services as loans, insurance, fund management, and credit cards. It is headquartered in London, England. This paper shall discuss the financial management policies of Sainsbury PLC with regard to three aspects of its operations: Capital Asset Pricing Model, the Weighted Average Cost of Capital, and Dividend Policy. In order to apply the Capital Asset Pricing Model, it is necessary to find a method to estimate the future beta, a component of a security’s risk which cannot be eliminated through diversification, which can applied in estimation of future returns.

The least squares regression can be used to develop a linear equation to explain the relationship between return on the stock and return on the market. The characteristic line is usually used to describe the relationship between the rate of return of a market portfolio and the rate of return of a security. It is derived by using regression analysis that summarizes a particular security or portfolios systematic risk and rate of return. The rate of return is dependent on the standard deviation of the assets returns and the slope of the characteristic line, which is represented by the assets beta.

A characteristic line of a stock is the same as the security market line. The slope of the line, which is a measure of systematic risk, determines the risk-return trade-off. According to this metric, the more risk you take on -

...Download file to see next pages Read More
Cite this document
  • APA
  • MLA
  • CHICAGO
(“Financial Management Essay Example | Topics and Well Written Essays - 4000 words”, n.d.)
Retrieved from https://studentshare.org/miscellaneous/1548022-financial-management
(Financial Management Essay Example | Topics and Well Written Essays - 4000 Words)
https://studentshare.org/miscellaneous/1548022-financial-management.
“Financial Management Essay Example | Topics and Well Written Essays - 4000 Words”, n.d. https://studentshare.org/miscellaneous/1548022-financial-management.
  • Cited: 0 times

CHECK THESE SAMPLES OF Financial Management

Financial Management and Factoring

percent of annual credit sales and saving the cost of trade debt financing through better collection. … One of the functions of Financial Management is to ensure that the company has enough cash to finance our operational requirements, that this cash is secured at the lowest possible cost, and that any idle cash we do not need is invested to earn the highest possible return.... n analysis of our current practices in this aspect of Financial Management has revealed the following problems:Trade receivables have increased from the desired thirty days to the actual fifty days....
11 Pages (2750 words) Essay

Financial Management Question 1

The annuity option will be subjected to taxation which includes the federal and state tax each year you receive your price whereas the cash option is subjected to tax only in the year you receive the amount. The money you win will not gain value in future if you choose the annuity option, whereas if you choose the cash option you can invest now or deposit the money in a bank where the money can earn interest rate. … The amount won is subject to the two options the annuity and the cash option; in any of the options given the amount does not add up to the same amount and therefore the price should not be termed as 363 million. However the lottery in order to attract more people to participate in the lottery they are justified to name the total amount to be won, they should also disclose all the information about the game to the people....
4 Pages (1000 words) Essay

Strategic Financial Management

The essay "Strategic Financial Management" aims to provide an in-depth insight into the efficient market concept and the nature of financing decisions.... It also comprises of the discussion on the efficient capital markets where it is difficult to incorporate intelligent financing decisions....
4 Pages (1000 words) Essay

Fundamentals of Financial Management

In the paper “Fundamentals of Financial Management,” the author discusses the case of Hamid Audio Video, which has requested for a long term loan from Gulf State Bank.... It is asked to analyze the business position of the company by using a financial ratio analysis method.... hellip; The author states that recommendation on the basis of the analysis is that the bank should grant a loan to the company since its long term financial position is satisfactory as compared to its last year's financial results....
3 Pages (750 words) Case Study

Debt Financing for the Project Rattle Company

However, it may decide to accept the same project if positive NPV is produced after proper adjustments are made, based on facts in the case study.... hellip; It further plans to use of 100% debt financing for the project.... This paper will attempt to help Rattle Co in making a decision by answering at least four Question one....
13 Pages (3250 words) Coursework

Applied Financial Management

The growth and expansion of the company are subjected to its effective Financial Management practice and performance.... The outlook of the financial practices and policies of the company are analyzed to evaluate Financial Management practices of the company.... to evaluate its financial position.... Therefore, the financial position of the company is analyzed using financial indicators (financial ratios)....
20 Pages (5000 words) Essay

Health Care Financial Management

The author of the "Health Care Financial Management " paper reports the issues to the author's senior manager and with his consent, the author makes use of the accounts payable checks to overcome the crisis.... The author implements the' float' tactic, the 'slow disbursements of accounts payable'....
6 Pages (1500 words) Coursework

Multinational Financial Management

management of an organization, particularly a business firm, is confronted with issues and decisions like the following, Multinational Financial ManagementEvery organization, irrespective of its size and mission, may be viewed as a financial entity.... management of an organization, particularly a business firm, is confronted with issues and decisions like the following, which have important financial implications: What kind of plant and machinery should the firm or a company buy?...
8 Pages (2000 words) Essay
sponsored ads
We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Contact Us