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Advisor(s)
Abstract(s)
The purpose of this thesis was to evaluate a listed company to demonstrate and use the
knowledge gathered during the master. The selected company was CTT – Correios de Portugal,
S.A. due to several reasons. Firstly, this is a Portuguese company, with long history and has
always played an important role in Portuguese society. Secondly, it has operations in other
countries than Portugal. Thirdly, it used to be owned by Portuguese Government and only
recently became listed in Lisbon Stock Exchange. Finally, even though the main source of
revenues (Mail) is facing severe challenges, as e-substitution and other factors have a negative
impact on mail volumes, CTT’s bet in the financial services sector, and more recently the Postal
Bank, seemed to be good strategy.
Before getting to CTT’s value assessment, the author goes through the academic theory on the
most relevant valuation methodologies for this valuation exercise. Then, detailed descriptions
of the company and postal sector were provided, as well as the assumptions and forecasts. In
the end, the author opted for assessing CTT business, excluding the postal bank, with a WACC
based discounted cash flow model. Then, decided to value the postal bank separately using a
FTE methodology, discounted at cost of equity.
As means of conclusion, the author ends this thesis by presenting a price target and respective
recommendation, and comparing his outcome with that of an investment bank’s research note
(BPI).