Corporate Finance Qantas Airways Ltd

Question: Discuss about the Corporate Finance for Qantas Airways Ltd. Answer: Introduction: The terminology market value is also popularly acknowledged as the market capitalization of an openly traded firm. This is commonly accomplished by the multiplication of the total numbers of outstanding shares with the recent value of the shares. The market price of a firm represents as an excellent pointer of the opinion of the financiers regarding the scenario of the industry. The elevated market price specifies the particular business has a superior valuation. Moreover, it has been noted that the market capitalization for the organization Qantas Airline Company is AUD 6.140 billion (Bloomberg.com 2016). From this value of market capitalization, it can be said that the specified organization Qantas Airline Company has an elevated valuation in the recent competitive market. On the contrary, it can be said from the thorough historical study that the stock price of the organization Qantas Airline Company remained invariable for the entire year, i.e., from the month of September in the year 2015 till at present (September 2016). It has been found that in the last September that is in September 2015, the price of the stock of the particular company was relatively higher that is AUD 4.09 (In.finance.yahoo.com 2016). However, it has been noticed that with the passage of time, the stock price started to reduce constantly for two consecutive months, October and November to AUD 3.83 and AUD 3.53 respectively (In.finance.yahoo.com 2016). Then in the month of December, the stock price certainly increased to AUD 3.97 and again decreased for two consecutively months (In.finance.yahoo.com 2016). During the period of April to June, 2016, the prices of the stocks reduced and then from the month of July of the year 2016, the share prices of the firm Qantas Airline Compa ny started to increase constantly (Qantas2015.reportonline.com.au 2016). At present, the stock price is AUD 3.21 and this indicates the particular organization has a stable progressing financial condition (In.finance.yahoo.com 2016). Due to its both financial and economical reliability, more investors should invest in this firm in order to earn a higher return. Additionally, this increase in the stock price will also increase the valuation of the organization with the passage of time. The debt to profit ratio implies the quantity of liability of an organization with respect to its amount of profit. Therefore, it can be said that the lower ratio is better for the organization. It has been found that for the organization Qantas Airline Company, this ratio is equivalent to 1.49 (Markets.ft.com 2016). It indicates that the specified organization has a healthy financial situation. References Bloomberg.com. 2016.QAN:ASE Stock Quote - Qantas Airways Ltd. [online] Available at: https://www.bloomberg.com/quote/QAN:AU [Accessed 19 Sep. 2016]. In.finance.yahoo.com. 2016.QAN.AX Historical Prices | QANTAS FPO Stock - Yahoo! India Finance. [online] Available at: https://in.finance.yahoo.com/q/hp?s=QAN.AXa=08b=1c=2015d=08e=19f=2016g=m [Accessed 19 Sep. 2016]. Markets.ft.com. 2016.Qantas Airways Ltd, QAN:ASX financials - FT.com. [online] Available at: https://markets.ft.com/data/equities/tearsheet/financials?s=QAN:ASX [Accessed 19 Sep. 2016]. Qantas2015.reportonline.com.au. 2016.Qantas2015.reportonline.com.au. [online] Available at: https://qantas2015.reportonline.com.au/system/files_force/downloads/full_qantas_annual_report_2015-1.pdf?download=2 [Accessed 19 Sep. 2016].