Financial & Valuation Modeling Boot Camp
Syllabus
Financial Statement Modeling
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.
DCF Modeling
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