Monsanto Report

4290 WordsFeb 21, 201518 Pages
Monsanto Valuation report Corporate Valuation, 10-17-2014 Executive Summary In the present report, the following aspects of Monsanto were presented & analyzed: * Background of the company, general public opinion and upcoming trends were scrutinized, to provide the framework for judging company fundamentals and building projections * The different costs Monsanto generates, from historical perspective and on comparative basis, using industry averages * The Cash flows the company generates, in the light of its leverage, ROC, ROE, growth, for to establish how to value the company * Monsanto’s firm value over a 3-stage growth model was established using DCF * The valuation was subjected to sensitivity testing, to establish the effect of different fundamental inputs into the valuations. * A comparative valuation model: relative valuation was introduced, to put the firm once again if its industry perspective. A conclusion was drawn on the value of Monsanto: the current report does find the company undervalued & the following pages provide details. Background Monsanto is a worldwide biochemical company that nowadays produces and sells genetically modified seeds and herbicides to farmers. The company has 2 business segments: Seeds and Genomics, and Agricultural Productivity. The products Monsanto sells make farming less time consuming and helps optimizing crops. For years, the company has been active on a variety of fields, such as producing plastics, caffeine and aspartame. The company employs over 20.000 people and operates worldwide. Among the challenges the company faces in the EU market is the more strictly regulated genetically modified organism (GMO) regime. Monsanto uses GMO’s in their products and provides them to farmers and this is allowed without any labelling requirements, hence the consumer doesn’t know about

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