04521 - Corporate finance

Learning outcomes

The aim of this course is to provide the students with a set of analytical tools and techniques necessary to explore the most important investment and financing decisions taken by firms at different stages of their life cycle. At the end of the course the student will be able to: - select the best business investment strategies a firm should undertake; - calculate and interpret the company’s cost of capital; - identify the main financing sources available to companies.

Course contents

Module I

• The role of corporate finance in corporations
• Maximization of shareholder value as a company objective
• Financial analysis and financial planning
• Principles of mathematical finance
• Evaluation of bonds and shares
• Investment assessment methods
• Risk – return relationship

Module II

• Estimation of the opportunity cost of capital through the Capital Asset Pricing Model
• Financing decisions
• Risk capital financing: venture capital and IPO
• Seasoned equity offerings
• Dividend policy

Readings/Bibliography

• Lecture notes. The notes will be available at: notes
• Book: R. Brealey, S. Myers, F. Allen, S. Sandri, Principi di Finanza Aziendale , McGraw Hill Libri Italia, 2015. Chapters 1-3, 5-10, 12-19 (ISBN: 978-13-088-6704-5). As attending the course is not mandatory, there is no difference between attending students and not attending students.
• Module I: Chapters 1-3 e 5-8 
• Module II: Chapters 9-10 e 12-19
• Some suggestions for the exercises: E. Bajo, M. Barbi, S. Sandri, Esercizi di Finanza Aziendale, Apogeo, 2017

Teaching methods

The program will be presented in depth in class. Theoretical and practical classes will be provided. Practical classes (4 for each module) will be based on the resolution of exercises and on the presentation of case studies.

Assessment methods

• Valuation is based on a written exam.
• The partial exam (the first one usually set at the end of October/beginning of November, the second one in January) is based on 11 Multiple Choices and 1 exercise, similar to those solved in class. The partial exam lasts 40 minutes.
• It is possible to access to the second partial exam, set in January, with a minimum score of 14.
• The total exam is composed of 22 Multiple Choices and 2 exercises that is 11 Multiple Choices and 1 exercise for each module. The total exam lasts 80 minutes. The mark of each module accounts for 50% of the final mark.
• With regard to both the partial exam and the total exam, the correct answer to a Multiple Choice gives 2 points. There is no penalty for the wrong answer and there is only one correct answer. The exercise has a value up to 10 points.
• Students are not allowed to use notes or books.
• A list of the most important formula is provided within the exam text.
• The final mark is expressed in thirties.
• The course will be taught during the first semester. Two calls will be set during the winter period (January-February) and the last calls will be set in September. The second partial exam and the first total exam take place on the same day. A call will be set in the second half of July on request of at least one student.

Teaching tools

Blackboard

Links to further information

https://sites.google.com/site/pierpaolopattitoni/teaching

Office hours

See the website of Pierpaolo Pattitoni