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Scheller College of Business

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Now showing 1 - 10 of 74
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    Cash Flow Trends and Their Fundamental Drivers: Comprehensive Review (Quarter 2, 2011)
    (Georgia Institute of Technology, 2011-10) Mulford, Charles W. ; Lopez de Mesa, Ariadna
    This research report is part of a continuing series that examines cash flow trends and the underlying drivers that are causing changes in those trends. The current study contains a review of the cash flow performance of all non-financial companies for a series of rolling twelve-month periods from the first quarter of 2000 through the second quarter of 2011.
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    Natural Hedges and the Management of Foreign Currency Risk: An Effective Antidote to Hedge Accounting (July, 2011)
    (Georgia Institute of Technology, 2011-07) Mulford, Charles W. ; Comiskey, Eugene E.
    In this report we examine more closely the use of natural hedges. Given their effectiveness in limiting earnings volatility while bypassing the risks associated with hedge accounting, natural hedges are gaining in importance to the financial management of the firm.
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    Cash Flow Trends and Their Fundamental Drivers: Comprehensive Review (Quarter 1, 2011)
    (Georgia Institute of Technology, 2011-07) Mulford, Charles W. ; Lopez de Mesa, Ariadna
    This report contains a comprehensive overview of Quarter 1 in 2011. Data for this research were provided by Cash Flow Analytics, LCC. Charles Mulford is a principal in Cash Flow Analyticsm LCC.
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    Seeking Guidance on the Dow? Try GDP
    (Georgia Institute of Technology, 2011-06) Mulford, Charles W. ; Jayaraman, Narayanan
    Following the market swoon of 2008 and 2009, equity prices have enjoyed a significant rebound. Investors are understandably interested in where stocks are headed next. An interesting long-term perspective on the subject can be gained by examining the extent to which Nominal Gross Domestic Product has explained the movement of share prices, in particular, the Dow Jones Industrial Average, over time. In this report, we look at the relationship between the two metrics since 1916, updated with data through the fourth quarter, 2010. Barring any unforeseen shocks, we find strong historical precedent for the Dow to be trading in the vicinity of 15,000 in 2011.
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    The Free Cash Profile: Insight into the Cash Flow Implications of Growth - An Analysis Using 2010 Data
    (Georgia Institute of Technology, 2011-05) Mulford, Charles W. ; Karnes, Chad M.
    With the end of the U.S. recession, companies are once again enjoying renewed, if limited, revenue growth. In terms of cash flow generation, as revenues grow, there are certain industries and companies that will benefit more than others. It is a common misbelief that growth requires a use of cash. The reality is that there are many companies that actually generate increasing amounts of free cash flow as revenues grow. These companies have what we refer to as a positive Free Cash Profile. The purpose of this study is to analyze the Free Cash Profile of forty-four non-financial industries and all firms within those industries with revenues in excess of $100 million. Our goal is to identify those industries that should generate cash as revenues continue to grow as well as those industries that will consume cash as growth resumes. We also identify companies within the industries driving those trends with the intent of identifying those companies that will benefit most with revenue growth. Overall, the median Free Cash Profile for our sample is 4.95%. However, eighteen industries, or forty percent of our sample, have a negative Free Cash Profile. However, even in these industries, there are numerous firms with positive profiles. The firms with positive Free Cash Profiles enjoy higher operating cushions and are more adept at managing operating working capital and limiting capital spending than firms with negative Profiles.
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    Changes in Accounting for Negative Goodwill: New Insights into Bargain Purchase Transactions
    (Georgia Institute of Technology, 2011-04) Comiskey, Eugene E. ; Mulford, Charles W.
    SFAS 141(R), Business Combinations, includes significant changes to the accounting and disclosure requirements for acquisitions made at less than fair value. Under new rules, acquisition-related gains, asset valuations and shareholders’ equity will be higher in transactions yielding negative goodwill, a financial statement element referred to henceforth as a bargain purchase amount. In years after the acquisition, operating earnings will be reduced as increased asset valuations are amortized or depreciated. Disclosure requirements contained in the revised standard provide financial statement readers with new insights into why firms are able to effect acquisitions at less than fair value. In reviewing 71 acquisitions, we find several reasons for the existence of such bargain purchase gains, ranging from financial distress of the target, to special characteristics of the acquiring firm, to flaws in the bidding process. These findings have implications for investors, who must analyze bargain purchase transactions, for CFOs and other corporate managers, who must implement the new standard’s provisions, and for regulators, who must determine whether the new standard is being properly applied.
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    Cash Flow Trends and Their Fundamental Drivers: Comprehensive Review (Qtr 4, 2010)
    (Georgia Institute of Technology, 2011-04) Mulford, Charles W. ; Miller, Brandon ; Lopez de Mesa, Ariadna
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    Cash Flow Trends and Their Fundamental Drivers: A Continuing Look Summary Review (Qtr 3, 2010)
    (Georgia Institute of Technology, 2011-01) Mulford, Charles W. ; Miller, Brandon