FINA5529: Topics in Finance I: Financial Modelling

Peer feedback and assessment will also be used to allow every team member to comment on and assess the contribution of his/her groupmates to the project. To facilitate this, we will use a software called SPARK (Self and Peer Assessment Resources Kit). Your final individual score will be weighted by the SPARK score you receive from your groupmates. Information about SPARK is available in the unit outline and on LMS.

If you have any technical problems in submitting the assignment or accessing SPARK, please contact Ms. Sandra Carro at [email protected]. 2

The Assignment

The website of this firm and its latest news can be found in the following link: 

https://www.telstra.com.au/aboutus

You will find a heading called “INVESTORS”, where details on the share price, latest announcements, financial reports, governance, and other important information can be found. https://www.telstra.com.au/aboutus/investors 

https://www.telstra.com.au/aboutus/investors/financial-results#2024 (2024 and previous years)

Besides, analysts’ forecasts and other important details about this firm can be found in the following links on yahoo finance and ASX:

Bloomberg’s Terminal in one of our libraries will also provide you with a lot of information and data for your analysis. Do not forget we have the Trading Room in our UWA Business School building (Level 1).

Required products:

Your investment recommendations

Background, stories, assumptions for your analysis (internal and external business environments, risks and corporate governance, others).

Key data and estimates (FCFF, WACC, Enterprise value, Implied share values from your valuation, and others). NO tables/figures are allowed in the report.

Cautions and limitations arising from your analysis

Any information you see fit for your report.

The following information may be relevant in guiding you the important information to be presented/discussed in your report. You can surely add anything you prefer for your product.

(i) Discuss your key assumptions used in your analysis

(ii) Estimate the firm’s free cashflow (FFCF) for the next 5 years (2025 to 2029 inclusive)

(iii) Estimate the weighted average cost of capital (WACC) as of 31 March 2025 3

(iv) Estimate the enterprise value.

(v) Estimate the equity value.

(vi) Use the equity value from your estimates and a number of stocks available in the market for Telstra, estimate the stock value from your valuation and then compare it with the current market price as of May 2025; and

(vii) Provide the recommendations for investment strategies to the AMV’s clients.

3) The excel file including all data/information presented in Item (2) above. Please make sure to also include other analyses you have done but cannot report in the appendix due to the limit. However, please make sure to indicate their existence in your appendix/report.

Marks allocations

The extensive use of Excel in producing estimates, graphs, figures and others (50%). You should demonstrate to utilise tools and techniques we have discussed and demonstrated during our seminars.

- The stories and estimates of relevant values/figures presented in your report (30%)

The consideration of issues we have discussed in the classes (estimating beta, risk free rate, and others (10%)

The professionalism of the presentations for the report, tables, figures and others (10%).

Finally, please do not forget to cite the source of any external information you use. Please make sure you use consistent referencing style (APA or Harvard)