Hey all,
The advice I've received here has always been impeccable. I'm in the initial interview process for a merchant bank run by an alumni. He gave me this email ahead of our first round interview
"Take a look at Firm. It's a [what kind of firm it is]. Competitors included [major competitors].
Here's what I am interested in... thoughts around how Firm is valued. That is, what's the company trade at as it related to forward earnings and forward revenues. Ideally looking at 2009 and 2010.
Here's what I am NOT interest in... you making a power point or some other paper. What I like is the opinion and the data behind it. If that comes in the form of a paragraph and 2 pdfs of separate analyst reports, that works. It could be something else."
I'm coming from an economics background and don't really start my in depth finance classes until next semester (minor in finance). I was wondering if someone could help point me in the right direction as far as the steps I need to take to complete this assignment.
I'd love to do it over pm or email where I can fill in the missing information for you. I just need some guidance as far as what relevant data I need to pull and where I can pull it from.
Thanks in advance all.
If you can't follow your contact's very explicit instructions, I'm not sure you're qualified for the job.
Pull the multiples and the analyst reports and form an opinion. Present said opinion in a paragraph to the contact.
Unnecessary to be a dickhead here. It's unlikely he even has access to research reports, so it's going to be pretty difficult to pull any multiples.
You're going to need to find a way to get research reports on the said company. When you get the report, the end should list multiples (you're going to need EV/revenue and P/E, based on his request) for the company and its comps (which should be similar to the similar companies your contact listed). After comparing where the target company is trading at versus the comparables, you should know where to go from there.
I would disagree here - most schools have access to something like Investext (aka the research side of Thomson One Banker) or another research feed. The reports might not be all from the best/biggest houses or the most up-to-date, but they will give a sense of the multiples used in valuing the company.
The rest of your post is spot on...
I've actually checked through my schools database. Unfortunately, since I'm not in the actual business school (I failed early in my career and chose economics over the business school) I don't have access to check to see if they even have that sort of material available. It's definitely not available through the general avenues available to all students.
Since it is publicly traded (although only for the past quarter, only SEC filing I could find was the 10-q for the previous quarter) is there somewhere online where I can pull a research report on it?
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