Cooper Industries Financial Analysis

EXECUTIVE SUMMARY
 
Nicholson File Company has a dominant grade in the complementary tools intentness and is in line with makes current growth and acquisitions st scoregy.  Based primarily on a comparison of discounted cash flows, a maximum legal injury per share is estimated at $87.04.  This price represents the industry growth and estimated improvements of Nicholsons operational and product costs.  Going into the future we feel Nicholson get out not compromise Cooper Industries current earnings.  Our current paygrade shows Cooper Industries can continue to be competitive in its acquisition of Nicholson File while maintaining a satisfactory fall back on investment. 
 
FORECASTED INCOMES
 
To establish a forecast for Nicholson File, assumptions were made in regards to costs, growth, and revenue.  Financial statements for the past 5 years were analyzed to educate average percentage growth of sales revenue.  To identify a high and low maximum share value, two sets of assumptions were made.  A conservative model representing current company growth, based on a current calculated growth value of 3.39%, use a forecasted Cost of Goods Sold (CGS) and Selling, General, Administrative (SGA) of 65.58% and 22.01% of sales individually (See Exhibit 1a).



A more robust growth rate of 6% with a gradual increase over foursome years was used based on current industry growth and Coopers anticipated goals for Nicholson.  A rate of 65% and 19% of sales were used for CGS and SGA in this model (See Exhibit 1b.).  We feel this comparison helps illustrate potence in the company.
EXHIBIT 1.a (Future Cash Flows from Operations)
OPERATIONS     ($ MILLIONS)19711972197319741975197619771978197919801981
Sales addition3.39%3.39%3.39%3.39%3.39%3.39%3.39%3.39%3.39%3.39%3.39%
Net sales55.357.1859.1161.1263.1965.3467.5569.8472.2174.6677.19
Cost of goods sold (67.58% of Sales)37.938.6439.9541.3042.7144.1545.6547.2048.8050.4652.17
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