Duration
30h E-Lrng
Number of credits
| Executive Master of Business Administration (Certificate organised abroad) | 3 crédits | |||
| Executive Master in Finance (Certificate organised abroad) | 3 crédits |
Lecturer
Language(s) of instruction
English language
Organisation and examination
All year long
Schedule
Units courses prerequisite and corequisite
Prerequisite or corequisite units are presented within each program
Learning unit contents
Corporations create value for their shareholders by making good real investment decisions. The objective of this course is to define what good investment decisions are, and how to value investment projects. Several objectives could be pursued. The objective function of a private business firms is to maximize the stockholder's wealth, which implies to maximize the firm value and to protect debtholders from bankruptcy. The shareholder maximization objective is thus much more restrictive than the maximization of the enterprise value. Publicly traded firms pursue an even more restrictive objective by receiving instantly the feedback from the market on their business decisions.
Corporate finance theory deals with all the decision that a business can make and that could have an impact on its value. Every decision that a business makes has financial implications, and any decision which affects the finance of the firm is a corporate decision. The objective that will be followed in this course is the firm value maximization. Two methods of firm valuation will be covered throughout the course: the income approach or Discounted Cash Flow method and the market approach based on multiples analysis.
Corporate finance deals with the following questions:
- In what long-lived assets should the firm invest? (Capital budgeting / Investing decisions)
- How can the firm raise cash for its required capital expenditures? (Financing decisions and capital structure)
- How should short-term operating cash flows be managed? (Timing of cash flows and short-term financing decisions)
- How should the distribution of cash to shareholders be managed? (Dividend policy and stock repurchases)
Learning outcomes of the learning unit
At the end of the course, students will acquire the fundamental knowledge and understanding in financial management to perform a rigorous analysis of a capital budgeting problem.
Students will be able to:
- Compute and forecast cash flows used for project or firm valuation;
- Estimate the prevalent cost of capital to be used to discount cash flows;
- Compute the Present Value (PV) of an investment project or a firm.
- Monitor short-term operating cash inflows and outflows.
- Perform a relative firm valuation.
Prerequisite knowledge and skills
Accounting and portfolio theory
Planned learning activities and teaching methods
Ebook including video tutorials and online quizzes
Mode of delivery (face to face, distance learning, hybrid learning)
Distance learning
Course materials and recommended or required readings
The following reading will enable students to deepen their understanding of the key concepts seen throughout the course. It is recommended to read chapters 9, 10, 11 and 13 of
- Hillier, Grinblatt and Titman, "Financial Markets and Corporate Strategy", McGraw-Hill, Second European Edition
Any session :
- In-person
written exam ( multiple-choice questionnaire )
- Remote
written exam ( multiple-choice questionnaire ) AND written work
- If evaluation in "hybrid"
preferred remote
Additional information:
Quizzes
Work placement(s)
Organisational remarks and main changes to the course
Contacts
Professor Marie Lambert: marie.lambert@uliege.be