Capella UniversityFPX 5014MBA-FPX5014_GaricaJessie_Assessment3-1.

RUNNING HEAD: FINANCIAL ENGINEERING TO ENHANCE SHAREHOLDER VALUE Assessment 3 – 1 Financial Engineering to Enhance Shareholder Value Jessie Garcia Capella University MBA-FPX5014 1/14/2019FINANCIAL ENGINEERING TO ENHANCE SHAREHOLDER VALUE Executive Report As Chief Financial Officer for Blizzard Entertainment, I have prepared a portfolio project that will demonstrate several financial strategies that all share the common goal of raising the valuation of the company, and methods for better financing of it. The first part of this portfolio will be financial strategies with the aim of increasing the value of our stock. The most direct route I will be exploring within this portfolio project of doing so will be directly increasing the demand for Blizzard’s stock, which in turn increases the price of it, and the value of it to our company. Additional parts of this portfolio will examine how such strategies, including the previous one mentioned, will affect the overall capital structure of the company. This will detail and provide with historical evidence the need for Blizzard to repurchase stocks, and begin production on a fan driven sequel to one of their current franchises in order to cushion the blow that is the risk they are taking by venturing into a new target demographic and market, that of mobile gaming. 2FINANCIAL ENGINEERING TO ENHANCE SHAREHOLDER VALUE Financial Engineering to Enhance Shareholder Value Here at Activision Blizzard, Inc. we are a leading, worldwide, developer and publisher of interactive entertainment (Blizzard, 2018) from development to distribution of the content and services. This encapsulates interactive digital entertainment and content on video game consoles, personal computers, and mobile devices (Blizzard, 2018). In order to determine our current financial health and the direction we should take to enhance shareholder value moving forward , I have prepared a portfolio project that will demonstrate several financial strategies that all share the common goal of raising the valuation of the company, and methods for better financing of it. Current Financial Health Income Statement A profit-and-loss account, also known as an income statement, details a company’s income and expenses during a specific set of time (Penman & Penman, 2007). Income statements are most often used to determine financial health of a business, determine how revenue becomes net income, track revenue trends, and provide a comprehensive look into how the business is performing over time (Penman & Penman, 2007). In Figure 1, Activision Blizzard, Inc. income statement has been provided. Detailed here, we can see that total revenue, gross profit, and cost of revenue have