Maximizing Stockholders Investment Value †Free Samples to Students

Question: Discuss about the Maximizing Stockholders Investment Value. Answer: Introduction: Discuss how successful the company has been at maximizing stockholders value over analyzing period. The discussion should be based on appropriate metrics and benchmarks. Share holders value is the returns received by the shareholders on the investment done in the company (Theeconomictimes, 2017). The value is created in the condition when the companies return exceeds the cost of doing business. The Skycity entertainment limited has continuous increasing profit which shows the positive impact on the shareholders value. Since the profit of the company is increasing the EPS also shows the increasing trend. Data of Skycity entertainment limited Particulars 2014 2015 2016 Shareholders Equity $773885000 $816922000 $1113042000 Number of equity shares 579706028 586071258 598489211 Net Profit $98537000 $128744000 $145672000 EPS 17 times 22 times 24 times (Source: Annual Report) Free cash flow is used to measure the amount of cash generated by the company after accounting for capital expenditure. If the company has more cash it can trail new opportunitys which can increase the profits of the company. Also having excess cash boost the dividend of the share holders. Creating enough cash for operating the business is an important indicator of share holders value since the organization can increase its sales without borrowing money from the market thereby decreasing the cost and increasing the profits (Kang, Anderson, Eom Kang, 2017). EPS of the Skycity entertainment is increasing which shows the positive impact on the shareholders value. EPS is the key indicator of to show share holders value of the company (Smith, 2015). Since the increase in earnings also increases the ratio, investors find the company more valuable. References Smith, T. (2015). What exactly do we mean by shareholder value?. Accessed on 1 May from: https://www.ft.com/content/463abec2-9721-11e4-845a-00144feabdc0 The economic times. (2017). Definition of 'Shareholder Value'. Accessed on 1 May from: https://economictimes.indiatimes.com/definition/shareholder-value Kang, H. C., Anderson, R. M., Eom, K. S., Kang, S. K. (2017). Controlling shareholders' value, long-run firm value and short-term performance. Journal of Corporate Finance, 43, 340-353. Skycityentertainmentgroup.(2015).Annual Report.Retrieved on 1 Marcg 2017from: https://www.skycityentertainmentgroup.com/media/1127/2015_annual_report.pdf Skycityentertainmentgroup.(2014).Annual Report.Retrieved on 1 Marcg 2017from: https://www.skycityentertainmentgroup.com/media/1138/sc5268_2014_annual_report_70_lr.pdf Skycityentertainmentgroup.(2016).Annual Report.Retrieved on 1 Marcg 2017from: https://www.skycityentertainmentgroup.com/media/1440/2016-skycity-entertainment-group-annual-report.pdf