Tottenham Hotspurs Case

You can find this case study in your course pack, please complete the assignment below: 

1. Assuming Tottenham Hotspurs continue in their current stadium following their current player strategy:

Perform a DCF analysis using the cash flow projections given in the case. Based on this DCF analysis, what is the value of the Hotspurs?

Perform a multiple analysis. Based on the multiples analysis, is the value of Tottenham any different?

At its current stock price of £13.80, is Tottenham fairly valued?

2. Using a DCF approach, evaluate each of the following decisions:

1. Build the new stadium
2. Sign a new striker 
3. Build the new stadium and sign a new striker 

3. Based on the results from 2, select a best choice and provide a logical argument to support it. 

Hints:

There are multiple ways to find the answer; individual’s answers may vary. Be sure to provide a logical reasoning for your assumptions. 

Exhibit 5 provides values for Discounted Cash Flows

1. DCF can be done a couple ways, based on EBITDA or calculating Free Cash Flows
2. If you use the Free Cash Flow Method, you will also need to include capital acquisitions by year and change the net working capital by year
3. Regardless of method, you need to determine a terminal value of the business (the present value of a perpetuity)