Case 13: Royal Mail –
- What is going on with Hillary Hunt and Royal Mail? Discuss relevant background information and the key issues facing Royal Mail.
- Why is it important to estimate a firm’s cost of capital? What does it represent? Is it set by investors or by managers? Who or what determines the cost of capital?
- What do you think of Kyle Brooks estimate of the WACC? Identify and explain any errors that you feel Kyle Brooks made.
- Re-estimate the WACC for Royal Mail & the Comparable Firms (Submit the response to Question 4 in Excel)
- Are the estimates of the WACC for comparable firms helpful to Hillary Hunt? Why?