Samsung Electronics: Cost of Capital Sensitivities
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Abigail Wing
College:
College of Business and Public Management
Major:
Accounting
Faculty Research Advisor(s):
Andreas Kakolyris
Abstract:
This study will research the financial decisions of Samsung Electronics, with a particular focus on its optimal capital structure. The aim is to understand how Samsung's market value is influenced by its leverage, utilizing an analysis of the weighted average cost of capital.
Using the synthetic rating method and data from Bloomberg Terminal, various leverage scenarios are simulated to uncover Samsung's capital sensitivities. Samsung Electronics, as a prominent player in the global technology market, presents an interesting case for examination, especially being a Korean company. The study will explain how changes in leverage impact Samsung's cost of capital and market valuation. By offering insights into Samsung's financial strategies, valuable perspectives are provided on how the company navigates market conditions and capitalizes on growth opportunities.
Ultimately, this research serves as a glimpse into Samsung Electronics' financial handling, uncovering the complex relationship between capital structure, cost of capital, and market value. These insights can inform investors, analysts, and stakeholders, offering a deeper understanding of Samsung's financial stability and strategic direction in the dynamic culture of the technology industry. My findings are presented and analyzed in this poster.