Corporate Finance

Code:

2MiF04

Acronym:

CF

Keywords
Classification	Keyword
OFICIAL	Management Studies

Instance: 2020/2021 - 1S

Active?	Yes
Course/CS Responsible:	Master in Finance

Cycles of Study/Courses

Acronym	No. of Students	Study Plan	Curricular Years	Credits UCN	Credits ECTS	Contact hours	Total Time
MIF	49	Official Syllabus after 2020-2021	1	-	3	21	81

Teaching language

English

Objectives

The objective of the discipline is to go through the major problems of Corporate Finance, formulating the most important issues arising from the financial activity of a corporation, that is, the concepts, methods and decision tools which serve as a basis for financial analysis and decision-making in the company, namely investment and financing decisions. It will be sought always direct support on the contributions of the most relevant academic work on each issue. 

The program is developed following a perspective of the value of the corporation. As a basic paradigm, it has been adopted the maximization of the value of the corporation for its shareholders, partners or owners. Every financial issue will thus be approached in terms of its potential for generating corporate value. 

The program of the discipline includes the strategic and structural issues in financial decision-making, the most important decisions of value creation. 

Learning outcomes and competences

Studenrs are expected to obtain an ability to go through the process of financial analysis and valuation of any business organization or investment project, always from the perspective of value creation.

Furthermore, students are expected to acquire specific competences in financial decision-making within the business organization, either on the investments side or on the financing side.

Finally, students will be trained on the interaction of business organizations with the financial markets. 

Working method

Presencial

Program

1. Introduction
1.1. The Financial Paradigm of the Corporation
1.2. Review of Main Concepts

2. Investment Decisions
2.1. Capital Budgeting Valuation Methods
2.2. Theoretical and Practical Issues of Investment Decisions
2.3. Sensibility Analysis and Simulation
2.4. Value, Risk, and Flexibility in Investment Decisions - The Real Option Approach

3. Short-Term Financial Decisions
3.1. Cash Management
3.2. Trade Credit Decisions
3.3. Short-Term Financing

4. Financing Decisions
4.1. Equity Financing Operations
4.2. Medium and Long Term Debt Financing Operations
4.3. Hybrid Financing Operations

5. Dividend Policy
5.1. Dividend Policy in Frictionless Markets
5.2. Share Repurchases
5.3. The (Ir)relevance of Dividend Policy

Mandatory literature

Ross, Stephen A., Randolph W. Westerfield and Jeffrey Jaffe; Corporate Finance, McGraw-Hill / Irwin, 2010. ISBN: 978-0-07-338233-7

Complementary Bibliography

Maness, Terry S., and John T. Zietlow; Short-Term Financial Management, West Publishing Company, 1993. ISBN: 0-314-01268-0

Teaching methods and learning activities

Students who are contacting the discipline for the first time are advised to begin by studying carefully the recommended textbook, as proposed in the bibliography. The same can be said with respect to those who might have acquired their financial education too long ago and might need updating. 

The tuition method in the discipline consists of a combination of theoretically based tuition with the critical analysis of decision-making problems. 

The direct participation of students in the classroom is encouraged. 

Evaluation Type

Distributed evaluation without final exam

Assessment Components

Designation	Weight (%)
Participação presencial	25,00
Teste	60,00
Trabalho escrito	15,00
Total:	100,00

Amount of time allocated to each course unit

Designation	Time (hours)
Estudo autónomo	40,00
Frequência das aulas	18,00
Trabalho escrito	12,00
Total:	70,00

Eligibility for exams

Students are evaluated on a continuous basis, taking into consideration their work across the whole course, either in the form of individual weekly assignments and quizzes.

Moreover, every student will sit for one final test.

Only exam evaluation is not available.

Calculation formula of final grade

Students final marks will result from the weighted average of the marks assigned to the following factors:

Final test: 60%
Individual weekly assignments: 15%
Quizzes: 25%