You can find 10 years worth of financial statement information on FDX Corporation (FDX; traded on the NYSE) by going to the Disclosure Database, which can be accessed from the Library's homepage.  (You're better off trying this from a Pace University site.  If you do this from an off-Pace site, you have to follow the instructions given on the Library site for remote access.)  You can find a lot of other information at this site as well.  The financial statement information, alone, can also be downloaded from my website. In addition, if you choose to, you can obtain additional information, either from the company itself or from other websites, such as the SEC Database. Use this information to analyse FDX's capital structure, using the approach laid out in Chapter 18 of Damodaran's text book on Corporate Finance (cost of capital approach).

A useful source of information is the company's annual report (for US companies, this can be obtained, either by writing to the company, from a library, or from the SEC Database), and in trade publications and other news outlets. You can also get information from the various sources identified on my Finance and Economics webpage. The bond rating agencies will also, frequently provide you with information on the latest bond ratings for the company. (See for example, Standard and Poor's ratings page.)

The report should be presented on an Excel spreadsheet pvcapstr.xls, and should consist of several worksheets. A worksheet name Computations will contain the spreadsheet analysis of capital structure using any of the templates that you can get from Prof. Damodaran's website in the Spreadsheets section. (There are many templates on Prof. Damodaran's website; use whichever one you think is most appropriate, according to your evaluation of their relative utility.)  Make sure to explain your source for each of your inputs to the template.

There should be three other worksheets included in the same file, which should address the following issues (preferably, do this part in Word and embed it in the Excel file.):

• Brief summary of the firm's operations. (Put this in a separate worksheet named History.)
• Discussion of results from the spreadsheet analysis. Include the following points in your discussion.
• In a worksheet called Recommendations, discuss the following points:
• your recommendations based on the spreadsheet results and your other analyses and an explanation of the reasoning underlying them.
• an analysis of the nature of AT&T's assets, from the viewpoint of its optimal capital structure.
• impact of the capital structure decision on the firm's operating income.
• comparison of the firm's capital structure with other firms in the industry.
• an analysis of other factors, which you have not explicitly taken into account in your spreadsheet analysis, which affect your recommendation.
• In a worksheet called Events, discuss the following points.
• recent events, and how they are relevant from the point of view of the firm's optimal capital structure.
• management actions in AT&T's history that might be interpreted as attempts to dispossess bondholders in favor of stockholders. (Include events where the main objective might have been a legitimate one, but which nevertheless had as a side objective, the transfer of wealth from bondholders to stockholders.)
• In a worksheet called Documents, embed a copy of any auxiliary documents that are used in your analysis. It will be sufficient to provide a listing of web addresses linked to those web locations.

You can also look previous Capital Structure Assignments and student solutions on the web. Note, however, that the originality of the submission and the analysis will be taken into account in grading.