Financial & Valuation Modeling Boot Camp

Review key Excel skills for financial modeling

• Basic Excel techniques and keyboard shortcuts
• The most accurate way to perform Excel’s basic functions without the mouse
• Customize Excel’s default settings for effective modeling

Learn to format and structure financial models to limit errors and simplify auditing

• Standard modeling structures and formulas
• Best practices in modeling
• Learn the correct way to check models for errors, accuracy and integrity
• Check and fix circular reference and iteration problems (#REF)
• Tools for formula checking and auditing

Learn how to present financial statement model

• Create a ratios page
• Prepare a model for distribution
• Learn summary and sensitivity analysis using data tables

Financial statement model development

• Learn to build projection drivers
• Learn to integrate assumptions into financial models – learn what makes a good assumption
• Build core statements:
  • Cash flow statement
  • Balance sheet
  • Income statement
• Build supporting schedules:
  • Debt schedule
  • Working capital
  • Interest schedule
  • Retained earnings
  • PP&E analysis
• Understand the interconnectivity of the core financial statements and learn how the cash flow statement, income statement, and balance sheet are linked.
• Learn to apply automatic “balance checks”
• Understand treatment of non-recurring charges and  tax implications on financial models
• Understand implications of new FASB regulations on financial models used by investment banks and other financial institutions.

Valuation methodologies deconstructed

• Learn market-based valuation, including comparable company analysis and comparable transaction analysis using appropriate equity and enterprise value multiples (PE, EV/EBITDA, etc.)
• Intrinsic valuation, including DCF and LBO (floor) valuation
• Presentation of valuation results using sensitivity analysis and data tables

Enterprise value relationships

• Participants learn to identify and analyze the elements of the financial statement that are key to the value of an enterprise, including:
  • Market capitalization
  • Enterprise value
  • Options
  • Preferred stock
  • Minority interests
  • Debt
  • Cash and marketable securities
  • Treasury Stock Method of Calculating Diluted Shares Outstanding

Calculate free cash flows using the unlevered valuation approach

• Use previously built model to derive unlevered earnings and unlevered free cash flow
• Handle working capital items, deferred taxes and long-term accruals

Discount the cash flows

• Learn how to derive a discount rate by deriving the cost of debt and the cost of equity
• Derive the cost of capital using CAPM
• Select the correct discount rates

Calculate the value

• Estimating terminal value
• Calculating enterprise value
• Using the enterprise value to determine implied share prices

Sensitivity analysis

• Analyze key input assumptions at various sensitivities

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