Question on Calendarization for Comp Analysis

Hey guys,

When performing comparable company analysis on a company with a FY other than Dec 31, what information do you actually calendarize for the company's financials (Reported Income Statement Section/Balance Sheet Data Section)?

Also if you do need to change the company's financial, couldn't you just find the exact CY sales with some basic algebra rather than using the calendarization calculation (CY sales = (Month #)(Actual Fiscal Year Sales)/12 + (12 - Month #)(Estimated Fiscal Year Sales)/12) ?

 
ikiq:
Hey guys,

When performing comparable company analysis on a company with a FY other than Dec 31, what information do you actually calendarize for the company's financials (Reported Income Statement Section/Balance Sheet Data Section)?

There's no set format for which financials to compare. That's up to the scope & nature of your analysis.

ikiq:
Also if you do need to change the company's financial, couldn't you just find the exact CY sales with some basic algebra rather than using the calendarization calculation (CY sales = (Month #)(Actual Fiscal Year Sales)/12 + (12 - Month #)(Estimated Fiscal Year Sales)/12) ?

Correct. That's actually how most analysts calendarize. I'm surprised you're mentioning it as it's some alternative/uncommon method.

__________
 
SaucyBacon85:
ikiq:
Hey guys,

When performing comparable company analysis on a company with a FY other than Dec 31, what information do you actually calendarize for the company's financials (Reported Income Statement Section/Balance Sheet Data Section)?

There's no set format for which financials to compare. That's up to the scope & nature of your analysis.

ikiq:
Also if you do need to change the company's financial, couldn't you just find the exact CY sales with some basic algebra rather than using the calendarization calculation (CY sales = (Month #)(Actual Fiscal Year Sales)/12 + (12 - Month #)(Estimated Fiscal Year Sales)/12) ?

Correct. That's actually how most analysts calendarize. I'm surprised you're mentioning it as it's some alternative/uncommon method.

simply enjoying your profile pic
 

You just use the most recent stub period, the latest 10k and the matching stub period from the previous year. If you're asking how to calculate LTM data to the very exact day, then you're asking for the impossible (I think, I may be wrong). Unless you're asking a different question in which you need to elaborate on your question better.

 

If you're in the middle of a quarter, you can't calculate LTM as of that date. Companies rarely ever release full financials midway through a quarter. You'd have to calculate LTM as of the latest finished quarter. Its just impossible to do otherwise simply due to a lack of information. Calendarization isn't difficult in any capacity I'd say. Its simply: Latest FYE + Latest Stub Period - Prior Stub Period. There's no real other way to calculate it simply because you don't get financials outside of the quarterly / yearly data.

 

You could weight 4Q15 as 1/3 (since only the month of January is relevant and one month is roughly a third of a quarter), take 1Q16, 2Q16, 3Q16 and 2/3 of 4Q16 (take November and December but drop January). To be honest though I'm not sure many people would bother doing this for one month.

 

Can we apply the method of calendarization discussed above to balance sheet data?

For eg, if my company's financial year ends at June 30 20XX, how can I get the amount of Accounts Receivable as at December 31 (20XX-1)? I was wondering whether it would make sense to calendarize in this example to get the answer since balance sheet line items are stock variables (at a certain date) and I have only seen examples of calendarization with flow variables (over a period).

Thanks.

 

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