Comprehensive Forecast

Question 1

Imagine that you are a financial advisor for Netflix, Inc., and Amazon.com, Inc. You are tasked with creating a comprehensive forecast of the revenue, costs, and cash flows of these companies, answering key questions that may influence their future decisions.

Use the Netflix and Amazon Data Spreadsheet to generate a pro forma forecast and consider what this indicates about the future for these two companies.

In a 2-page paper, provide the following:

• A forecast of Netflix, Inc., and Amazon.com, Inc.’s revenue, costs, and estimated cash flows into the next five years.
• The appropriate discount rate for Netflix, Inc., and Amazon.com, Inc.’s forecasted cash flows.
• An appropriate risk-adjusted rate of return for use in evaluating an investment in Netflix, Inc., and Amazon.com, Inc.
• A determination of the estimated fair market value of 100% of Netflix, Inc., and Amazon.com, Inc.’s equity.

Question 2

Imagine that you are the liaison between the decision makers and the followers and that your role is to communicate potential personnel change initiatives. Using the communication strategies found in the text, what actions will you take to format the conversation with employees regarding the restructuring process?