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    QA-21. Valuation of Wal-Mart's International Business

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    hy_saingheng_7602609
    Walmart operates stores internationally in countries like Argentina, Brazil, Canada, China, Mexico, and the UK, totaling over 2,750 stores abroad. To determine the present value of Walmart's non-US business, one would estimate future earnings cash flows for each non-US store based on historical data and growth rates, convert to dollars using forecasted exchange rates, and calculate the present value of cash flows for each country. Adding up the present values for each country would yield the total present value of Walmart's international business.

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    QA-21. Valuation of Wal-Mart's International Business

    Uploaded by

    hy_saingheng_7602609
    497 views1 page
    Walmart operates stores internationally in countries like Argentina, Brazil, Canada, China, Mexico, and the UK, totaling over 2,750 stores abroad. To determine the present value of Walmart's non-US business, one would estimate future earnings cash flows for each non-US store based on historical data and growth rates, convert to dollars using forecasted exchange rates, and calculate the present value of cash flows for each country. Adding up the present values for each country would yield the total present value of Walmart's international business.

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    QA-21. Valuation of Wal-Mart’s International Business

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    QA-21. Valuation of Wal-Mart’s International Business

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    Walmart operates stores internationally in countries like Argentina, Brazil, Canada, China, Mexico, and the UK, totaling over 2,750 stores abroad. To determine the present value of Walmart's non-US business, one would estimate future earnings cash flows for each non-US store based on historical data and growth rates, convert to dollars using forecasted exchange rates, and calculate the present value of cash flows for each country. Adding up the present values for each country would yield the total present value of Walmart's international business.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    497 views1 page

    QA-21. Valuation of Wal-Mart's International Business

    Uploaded by

    hy_saingheng_7602609
    Walmart operates stores internationally in countries like Argentina, Brazil, Canada, China, Mexico, and the UK, totaling over 2,750 stores abroad. To determine the present value of Walmart's non-US business, one would estimate future earnings cash flows for each non-US store based on historical data and growth rates, convert to dollars using forecasted exchange rates, and calculate the present value of cash flows for each country. Adding up the present values for each country would yield the total present value of Walmart's international business.

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    21. Valuation of Wal-Marts International Business.

    In addition to all of its stores in the United


    States, Walmart Inc., Stores has 13 stores in Argentina, 302 stores in Brazil, 289 stores in
    Canada, 73 stores in China, 889 stores in Mexico, and 335 stores in the United Kingdom.
    Overall, it has 2,750 stores in foreign countries. Consider the value of Walmart as being
    composed of two parts, a U.S. part (due to business in the United States) and a non-U.S. part
    (due to business in other countries). Explain how to determine the present value (in dollars) of
    the non-U.S. part assuming that you had access to all the details of Walmart businesses
    outside the United States.
    ANSWER: The non-U.S. part can be measured as the present value of future dollar cash
    flows resulting from the non-U.S. businesses. Based on recent earnings data for each store
    and applying an expected growth rate, you can estimate the remitted earnings that will come
    from each country in each year in the future. You can convert those cash flows to dollars
    using a forecasted exchange rate per year. Determine the present value of cash flows of all
    stores within one country. Then repeat the process for other countries. Then add up all the
    present values that you estimated to derive a consolidated present value of all non-U.S.
    subsidiaries.

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