EQUITY VALUATION IN A DAY

PROGRAM OUTLINE

The aim of the day is to look at different valuation techniques and understand the important parameters that can cause theoretical valuation to break down if overlooked.

This is a condensed version of three equity valuation classes – we will take a brief overview of various techniques for equity valuation, focus on Discounted Cash Flow techniques and show that DCF and multiples actually do the same thing – but only if you make the same assumptions. Models will be based on real companies.

PRE-REQUISTES

Accounting from a course such as Accounting in a Day in the Introduction to Financial Markets: Equities module, and familiarity with financial statements and financial statements analysis such as the course in this series.

CONTENT

Introduction to Valuation techniques
– Introduction to valuation techniques for equities
– Analysts language vs accounting language
– ‘Enterprise Value’. Another way to look at the balance sheet?

Multiples and Value Drivers – Factors to consider when multiples differ
– Value drivers in a business
– Relationship of growth to value in real and modelling world
– Equity vs Enterprise Multiples

DCF – Defining concept of ‘enterprise free cash flow’
– Discounting forecasted cash flows
– Terminal values-how to extend forecasts to infinity
– DCF mathematics made easy
– Adding value creation assumptions in the long run

COURSE DURATION

 1 Day

WHO SHOULD TAKE THIS COURSE?

Appropriate for students who are primarily focused on single stock analysis, but does not exclude those doing credit analysis

MODULES

These courses are included in this module

INTRODUCTION TO FINANCIAL MARKETS: EQUITIES

To untangle the language and purpose of the financial markets and to enable students decide the direction of their future studies/career

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ACCOUNTING IN A DAY

Students will learn to be able to prepare basic accounts and see how this fit into reported financial statements for public companies.

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FINANCIAL STATEMENTS ANALYSIS

To understand how to extract information about the operating efficiency, value drivers and financial risks of a company from analyzing its financial statements.

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FINANCIAL MODELLING

The course teaches a standardised methodology for analysts which will make research easier to perform and easier to understand. Rather than trying to impose an approach, the course aims to reach you how to model for yourself so you can then tailor your approach according to the companied you cover. Rather than using a stooge company with over-simplified financial statements, the course will model a real local company and try to deal with real problem areas found on financial statements such as ‘other’.

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