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Investment Plan For Newcastle Wood Recycling
Investment Plan For Newcastle Wood Recycling
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Order Number |
546567092 |
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Type of Project |
ESSAY |
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Writer Level |
PHD VERIFIED |
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Format |
APA |
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Academic Sources |
10 |
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Page Count |
3-12 PAGES |
Instructions/Descriptions
Investment Plan For Newcastle Wood Recycling
Running Head: Stock Review of the investment plan for Newcastle Wood Recycling CIC 1
Stock Review of the investment plan for Newcastle Wood Recycling CIC 9
Stock Review of the investment plan for Newcastle Wood Recycling CIC
Table of Contents Overview 3 Goal and Objectives 4 Constraints 6 Strategy 6 Feedback and Evaluation 8 Discussion 9
Background
This paper presents a critical review of the investment plan of Newcastle Wood Recycling corporation’s strategic formulation, strategic implementation, and strategic evaluation objectives constrain and risk tolerance level.
This investment plan is to be applied to effective planning to ascertain the going concern concept.
Increment in the total attributable profits is the fundamental goal of every organization and a driving factor to attract more investors.
When the management of any business entity has a plan for expanding its day to daily business activities, several ways must be drafted to generate more capital based on the stock review.
The capital increment is achieved through issuing bonds, stocks/equity, and taking out loans.
Purpose
It would be of great benefit for Newcastle wood recycling CIC Company to invest more capital in event organizing activities.
This investment plan is doomed to be a package of public address system services, tent services provision, and open catering.
Event organizing can simply be explained as project management, which entails creating small- or large-scale occasions such as festivals, conferences, weddings, ceremonies, or even formal parties.
This project’s expected return is to double the organization’s profit earnings with a 20% favorable factor (Jury, 2012).
The business operations on both short-run bases and long-run bases will hence be made sure of investing in this plan.
Further, the investment plan is expected to incorporate $ 100,000, which is 5% of the allocated budgetary funds allocated for research and development.
Conducting research and development will be an essential process that needs to be frequently done to ensure the sustainability of the entity in the market for a long-term duration; thus,
keeping the truck’s organization with the current competitive measures applied by its competitors.
The accumulation phase of this respective project begins when the investors opt to undertake this investment risk based on long term projected returns. Adequate capital hence needs to be set aside to aid in ascertaining this respective aspect. This is achieved by the presumption of the holding period returns, which can be presented in the HPR stock Portfolio.
Holding period return is an accounting calculation for the total expected market returns for a given asset or investment plan with a specified duration of time. It is a guiding tool used by the
management to determine which investment plan is worth investing in to enhance sustainable going concern. Going concerned is a financial concept used in giving insight into a business
entity’s ability to take on its operation from a short-run and long-run perspective. HPR Portfolio provides a comprehensive financial performance of a specified assets or investment plan with
which maximization of profit yield is enhanced through appreciation of the investment plan and distribution of dividend paid.
Goal and Objectives
This stock review’s primary goals for the investment plan on event organizing activity are to enhance profit maximization by utilizing the available resources in the market to ascertain the going concern concept.
Risk tolerance
The risk tolerance level based on the standard deviation is expected to be 0.0001 on long term bases. Standard deviation is basically used to measure the dispersion of set returns for shares
from the mean returns. Accordingly, the standard deviation is also used to shed light on any given investment’s historical volatility. The standard deviation figure is more significant from the
expected average return is represented. Therefore, it indicates a minimal price range of the output commodities translating to low risk.
This project’s entire risk is expected to incorporate a high level of risk tolerance based on the actual cost of the investment amounting to $100,000. As a result, this investment plan is set to
target an additional risk level between 5-15%. The beta value of this project is expected to be 2.3345. Application of beta is basically applied in estimating volatility, or systematic risk, of a
security or a portfolio, compared to the market as a whole. Beta is used in the capital asset evaluating model (CAPM), which measures an asset’s anticipated return based on its beta and
expected market returns.
If it shows positive, it means that when the market increases, the share return will also increase. If it is negative, then one rise and the other falls. Besides, a beta of 2.3345 indicates that the
security’s price moves with the market. However, when the beta value is less than 1, it implies that the security is theoretically less volatile than the market. Hence, having a beta value of
2.3345, which is greater than one, indicates that the security’s price is theoretically more volatile than the market returns.
Return Objectives
This investment project’s expected profit margin is expected to range between 20-30% over the respective financial period. This is expected to be 10% higher than the risk volatility range
enhancing; therefore, the projected net expected returns will marginalize the risk of losses to be incurred (Jury, 2012).
The time horizon for this project is expected to run between 5-8 years. Consequently, this fund’s holding period is relatively long based on the project life hence require minimal cash reserves
not greater than 20% of the expected market returns. However, this investment plan is based on the liquidity ratio of shareholders ratio of capital contribution. This investment plan is
formulated and expected to operate under the investment ACT 1940. The financial statements and other respective computation based on this investment project should be found on the
generally accepted accounting principles (GAAP) and international accounting standards (IAS). Tax computation is a significant measure computed according to federal tax laws provided for
this project’s effective and efficient long-term sustainability.
Strategy formulation
This can be explained as the primary stage where a business assesses its daily operations by analyzing internal and external factors. Further, vivid scrutiny is also another critical fundamental
step undertaken to ascertain the life span of the investment plan on a long run basis. This mechanism tends to provide insight into the internal and external forces that are important in
developing the company’s strategic plan in the current competitive market. While these factors change with time, this company’s growth depends mostly on Newcastle Wood Recycling CIC’s
capacity to capitalize on the competitive advantage associated with this investment plan to maximize the expected market returns (ADB, 2013) suggested.
Strategy implementation
After conducting the relevant research relating to this investment plan, the entity needs to differentiate between the short term and the long-term expectations. Further, allocations of
budgetary funds need to be performed in agility relating to the different aspects of the investment plan. The argument based on skill is that the success of investing in events organizing
programs will be centered on determining the firm’s ability to nurture both internal and external environments while creating a favorable working environment for employees. This stage will
also be a significant step in managing Newcastle Wood Recycling CIC because other functional organization structures will be formulated, which are an aiding factor to maximizing profits
returns.
Strategy evaluation
Newcastle Wood Recycling CIC’s continued success because success today doesn’t necessarily mean that the business enterprise will remain successful shortly. Therefore, it will be
expedient for this entity to implement strategic evaluation for this investment plan to ensure the market returns’ continued maximization. In this stage, reviewing the internal and external
factors that affect this project is profoundly analyzed and the appropriate measures (Simerson, 2011).
Modified internal rate of return for this investment plan
Identification of this ratio to the management of Newcastle Wood Recycling CIC Company will be of great significance in projecting the expected amount of bond returns, which will be
reinvested at the entity’s capital cost based on the initial outlay of the project. Specifically, calculation of this financial ratio will be of great significance in providing a comparative baseline in
which the management of Newcastle Wood Recycling CIC Company will be able to compare projected financial earnings of other projects with other alternative projects.
Stock Evaluation
Evaluation of the stock review for this business entity will be based on capitalizing the available market opportunities to yield the expected returns.
| Company | Support for investment |
| North Atlanta wood | The wood company that is newly emerging in the market and been articulated to have an annual growth rate of 5.5091%. Its expected earnings per share have been represented to have marginally increased over the recent by a marginal rate of 2.5%. This entity’s forecasted financial statements indicate a positive growth rate; hence, this company will form one of the primary shareholder’s equities for Newcastle Wood Recycling Company. |
| Kurt Geiger limited | Kurt Geiger limited is a significant source of revenue for this business entity. It has been represented to have increased revenue earnings from 324.6 million for the financial year ending 2018 to 334.9 million for the financial year ending in 2019. The gross profit margin has also been depicted to have linearly increased from 53.7%, 54.48%, and 55.02%, respectively, for the financial year ending in 2017 to the financial year ending in 2019. This clearly illustrates that maximization of the available resources to yield the expected profits has been made profound forming; therefore, a significant source of revenue for this company. |
| Target Corporation | The other subsequent proposed shareholders for this entity are Target Corporation. Based on this company’s market analysis that indicates total debt to equity ratio of 118.09 in the financial year ending in 2019 is a clear indication that the entities going concern level is unavoidable. The total debt to capital ratio is another significant capital structure measure, which has been represented as 54.15. The debt to asset ratio has been represented to be 32.67, the long-term debt to equity ratio of 115.04, and a long-term debt to total capital ratio of 52.75. |
| Kay Donnelly Enterprises | This bond can be articulated with a minimum optimal transfer of market mechanism. This phenomenon indicates that its market operations are based on optimal choice making for the revenant opportunity, which will maximize returns. The composition of this bond is 10% bank loan and 15% asset-backed. |
| Beth McDonough Corporation | This bond is centered on the low-quality provision to yield high market returns for long term sustainability. The bond composition is 39% corporate, 3% bank loans, and 22% in monetary terms. Over the recent past, this bond has articulated to have an estimated market return of 18.5% of the total amount initially invested. |
| Maple leaf Food Inc. | Maple leaf food Inc. is one of the most renowned consumer packaged meat company in Canada. The bond composition is based on 20% corporate, 33% bank loans, and 30% in monetary terms. |
| Just Eat PLC | Just Eat is a limited private organization in the British that operates food order and delivery entirely online. It is considered one of the significant financial sources for Newcastle wood recycling due to its enhanced operating income of £ 779.5 million in 2018 and a net income of £ 799.9 million. The composition of this bond is 25% cash-based and 17% bank loan. |
| Smithfield Company | Smithfield Company has been listed as the largest pork processer in the world. This company has been categorized amongst the best performing entities due to high-profit yields presented in its financial positions’ annual statements. It’s a significant source of bond having return on market shares of 33.38% |
| Tyson Corporation | Tyson Foods is an American food processing firm based in Springdale. Its daily operations entail processing chicken, beef, pork, and it is the second-largest processing entity according to its market shares. It is considered one of the significant sources of investment bonds for this company, having 12% corporate finance composition and 25% in monetary terms. Over the recent past, this bond has been articulated to have an estimated market return of 38% of the total amount initially invested. |
| Pine Street Capital | This type of bond can be described as a small hedge fund with approximately 32 million under management specializing in the technology sector. PSC was founded-founded in 1999 by three partners, each having an extensive background in the technology sector. This stock fund deploys a neutral market strategy, meaning that the fund aims to hedge out all market risk through short selling the market index. |
Conclusion
In summary therefore, it is clearly evident that this investment plan is presumed to have a certain going concern. Going concern basically means the ability the investment plan to be able to
operate in the near future smoothly by yielding maximum returns and minimizing the cost attributed to be incurred. The ability of this investment plan to be able to run smoothly in the near
future is determined through presentation of true and fair value of information in the financial statement and accurate computation of other relevant measures to predetermine the long-term
sustainability of the project. The need therefore of ensuring accurate presentation of values in the financial statement and financial ratios do exist so as to enhance a healthy decision making
based on this investment plan. Further, depending on the on the intended business venture as indicated in the operational model, it is vividly clear that the profitable level of investing on event
organizing program is certain and that the stock reviewing report indicates this investment plan to be worth undertaking (ADB,2013), acknowledges.
Reference
ADB, (2013). Stakeholder Engagement in Preparing Investment Plans for the Climate Investment Funds: Case Studies from Asia. Manila: ADB.
Jury, T. D. H. (2012). Cash flow analysis and forecasting: The definitive guide to understanding and using published cash flow data. West Sussex [England: John Wiley & Sons.
Simerson, B. K. (2011). Strategic planning – a practical guide to strategy formulation and execution.
Investment Plan For Newcastle Wood Recycling
