Preface | p. iv |

Acknowledgments | p. ix |

The Foundations | p. 1 |

The Firm: Structural Set-up | p. 1 |

First Principles | p. 2 |

Corporate Financial Decisions, Firm Value, and Equity Value | p. 5 |

A Real-World Focus | p. 6 |

A Resource Guide | p. 7 |

Some Fundamental Propositions About Corporate Finance | p. 7 |

Conclusion | p. 8 |

The Objective in Decision Making | p. 9 |

Choosing the Right Objective | p. 10 |

The Classical Objective | p. 11 |

Maximize Stock Prices: The Best-Case Scenario | p. 14 |

Maximize Stock Prices: Real-World Conflicts of Interest | p. 14 |

Alternatives to Stock Price Maximization | p. 37 |

Maximize Stock Prices: Salvaging a Flawed Objective | p. 40 |

A Postscript: The Limits of Corporate Finance | p. 53 |

Conclusion | p. 54 |

Live Case Study: Corporate Governance Analysis | p. 55 |

Problems and Questions | p. 57 |

The Basics of Risk | p. 58 |

Motivation and Perspective in Analyzing Risk | p. 59 |

Equity Risk and Expected Returns | p. 60 |

The Risk in Borrowing: Default Risk and the Cost of Debt | p. 87 |

Conclusion | p. 94 |

Live Case Study: Stockholder Analysis | p. 95 |

Problems and Questions | p. 96 |

Risk Measurement and Hurdle Rates in Practice | p. 100 |

Cost of Equity | p. 101 |

From Cost of Equity to Cost of Capital | p. 155 |

Conclusion | p. 174 |

Live Case Study: Risk and Return: Analysis for the Firm | p. 175 |

Problems and Questions | p. 177 |

Measuring Return on Investments | p. 182 |

What Is a Project? | p. 183 |

Hurdle Rates for Firms Versus Hurdle Rates for Projects | p. 185 |

Measuring Returns: The Choices | p. 191 |

Investment Decision Rules | p. 214 |

Probabilistic Approaches to Investment Analysis | p. 239 |

Conclusion | p. 254 |

Live Case Study: Estimating Earnings and Cash Flows | p. 256 |

Problems and Questions | p. 257 |

Project Interactions, Side Costs, and Side Benefits | p. 260 |

Mutually Exclusive Projects | p. 261 |

Side Costs from Projects | p. 282 |

Side Benefits from Projects | p. 287 |

Options Embedded in Projects | p. 293 |

Measuring the Quality of Existing Investments | p. 307 |

Conclusion | p. 321 |

Live Case Study: Estimating Earnings and Cash Flows | p. 323 |

Problems and Questions | p. 324 |

Capital Structure: Overview of the Financing Decision | p. 328 |

The Choices: Types of Financing | p. 329 |

Financing Behavior | p. 340 |

The Process of Raising Capital | p. 347 |

The Tradeoff of Debt | p. 359 |

No Optimal Capital Structure | p. 372 |

There is an Optimal Capital Structure | p. 378 |

How Firms Choose Their Capital Structures | p. 380 |

Conclusion | p. 385 |

Live Case Study: Analyzing a Firm's Current Financing Choices | p. 387 |

Problems and Questions | p. 389 |

Capital Structure: The Optimal Financial Mix | p. 393 |

Operating Income Approach | p. 394 |

Cost of Capital Approach | p. 398 |

Adjusted Present Value Approach | p. 434 |

Comparative Analysis | p. 441 |

Selecting the Optimal Debt Ratio | p. 444 |

Conclusion | p. 445 |

Live Case Study: The Optimal Financing Mix | p. 447 |

Problems and Questions | p. 448 |

Capital Structure: The Financing Details | p. 455 |

A Framework for Capital Structure Changes | p. 456 |

Immediate, Gradual or no Change | p. 456 |

Choosing the Right Financing Instruments | p. 475 |

Conclusion | p. 498 |

Live Case Study: Mechanics of Moving to the Optimal | p. 500 |

Problems and Questions | p. 502 |

Dividend Policy | p. 505 |

Background on Dividend Policy | p. 506 |

When are Dividends Irrelevant? | p. 519 |

The "Dividends are Bad" School | p. 522 |

The "Dividends are Good" School | p. 529 |

Managerial Interests and Dividend Policy | p. 540 |

Conclusion | p. 543 |

Live Case Study: The Tradeoff on Dividend Policy | p. 544 |

Problems and Questions | p. 545 |

Analyzing Cash Returned to Stockholders | p. 546 |

Cash Returned to Stockholders | p. 547 |

A Cash Flow Approach to Analyzing Dividend Policy | p. 555 |

A Comparable Firm Approach to Analyzing Dividend Policy | p. 581 |

Managing Changes in Dividend Policy | p. 585 |

Conclusion | p. 588 |

Live Case Study: A Framework for Analyzing Dividends | p. 589 |

Problems and Questions | p. 591 |

Valuation: Principles and Practice | p. 595 |

Discounted Cash Flow Valuation | p. 597 |

Relative Valuation | p. 649 |

Reconciling Different Valuations | p. 667 |

Conclusion | p. 668 |

Live Case Study: Valuation | p. 669 |

Problems and Questions | p. 671 |

Basic Statistics | p. 675 |

Financial Statements | p. 682 |

Time Value of Money | p. 694 |

Option Pricing | p. 707 |

Glossary | p. 718 |

Index | p. 721 |

Table of Contents provided by Ingram. All Rights Reserved. |