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 on the platform “virtuale.unibo.it”.
• Book: R. Brealey, S. Myers, F. Allen, S. Sandri, Principi di Finanza Aziendale , McGraw Hill Libri Italia, 2020. Chapters 1-3, 5-10, 12-19 (ISBN: 8838695717 · 9788838695711). 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 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 is usually set at the end of October/beginning of November, the second one in January) is based on 16 Multiple Choices (32 points). The partial exam lasts 40 minutes. It is possible to access the second partial exam, set in January, with a minimum score of 14.

• The total exam comprises 32 Multiple Choice Questions: 16 Multiple Choice Questions for each module. The total exam lasts 80 minutes. Each module weighs 50% of the total score.

• A correct answer to a Multiple Choice Question gives 2 points. There is no penalty for wrong answers, and there is only one correct answer.

• This examination method will be valid for the entire period of the health emergency.

• Students are allowed to use notes or books.

• The course will be taught during the first semester. Two calls will be set during the winter period (January-February), and the last call 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 at the request of at least one student.

• Graduation grid of marks:
  - Minimum grade 18; maximum grade 30L.
  - 18-23: sufficient preparation and analytical skills on a limited number of topics covered in the course.
  - 24-27: adequate preparation and analytical skills but with some limitations; good operational skills, even if not particularly articulated.
  - 28-30: very good knowledge of a large number of topics covered in the course; good operational and critical skills.
  - 30L: excellent and exhaustive knowledge of the topics covered in the course; critical analysis and connection skills.

Teaching tools

Blackboard

Office hours

See the website of Pierpaolo Pattitoni