Strategisk analyse of værdiansættelse af Pandora

Nicholas Tourell & Jesper Møller Pedersen

Student thesis: Master thesis

Abstract

The primary purpose of this thesis has been to determine the market value of the shares in PANDORA at 6 November 2012. To determine the market value, we performed a strategic analysis with the purpose of focusing on which outside circumstances impact PANDORA as well as what characterizes the jewellery industry. The conclusion showed the internal strengths and weaknesses of PANDORA as well as new opportunities and threats that PANDORA should be aware and mindful of in the future. The strategic analysis concluded that PANDORA has a strong brand and is good at entering new markets. However, PANDORA is also dependent on its Moments collection and the price of their raw materials, including gold and silver prices in particular. The strategic analysis was followed by a financial analysis focusing on the financial drivers influencing PANDORA. A profitability analysis has been carried out and compared with that of their largest competitor, Tiffany & Co. This showed that PANDORA has the best profitability - although declining primarily due to an unsuccessful pricing strategy which was however adjusted during 2012. Based on the above analyses, budgeting of future free cash flow was performed for PANDORA after which a value estimate was performed according to the DCF model. Our market value of the shares in PANDORA was estimated at DKK 131,111. A sensitivity analysis was prepared of this estimate which established that the price estimate is sensitive to changes in the WACC as well as the prepared budget variables. On the basis of our valuation, we find that significant uncertainty is attached to the PANDORA share; however, as long as customers want the Moments collection, PANDORA will continue the positive trend. Opportunities for increased growth are more likely if PANDORA boosts its other collections and creates demand for these products.

EducationsMSc in Auditing, (Graduate Programme) Final Thesis
LanguageDanish
Publication date2013
Number of pages154