Marriott Case

MEMO To:Dan Cohrs Vice President of Project finance From:Finance Consultants take aim of Management Boston University Date:February 1, 2012 ------------------------------------------------- Re: Recommendations for Annual Hurdle regularise Adjustments When expression at the vault judge our team has deduced that utilise one burial vault calculate for the entire Marriott Corporation is an death penalty to be utilise with caution and only executed when looking at drop in an all-inclusive type of investment, such as a resort that consists of all segments: lodging, restaurants, and contracts. However, when investing in projects tailored to Marriotts someone lines of business we recommend use the specific hurdle rates we calculated as abide be seen in exhibit XX. Using these hurdle rates will throw off Marriott a more accurate moving picture of the gamble they face from various investment projects, enabling Marriott to act upon strategic investment dec isions and not passing up whatsoever opportunities.

For the individual business segments that Marriott operates in, for example lodging, we further dissected the WACC counts to rule a more accurate hurdle rate for each(prenominal) line of business. We did this by looking at betas for companies within an labor (ex. Lodging attention companies such as Ramada, La Quinta, etc.), and unlevering them so that they were irrespective of their strange big(p) structures. We then averaged all of the unlevered betas and relevered it to Marriotts Lodging capital structure. Applying this restructured beta to our CAPM ca lculations provided for a much more accurate! WACC calculation for the specific industries Marriott operates in. (ADD IN OTHER straggle OF THE BETA CALCULATIONS)If you deprivation to get a full essay, stage it on our website: BestEssayCheap.com

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