Point72 Academy Experienced Professionals Case Study

I am currently working full time as an assistant relationship manager in commercial banking at a global bank and applied for the Point72 Academy for Experienced Professionals. Worth mentioning that I interned at Point72 last summer (not in the L/S team; in an Investment Services team), and I knew from that point onwards that I wanted to work for a hedge fund. I unfortunately chickened out and didn't end up applying for the Academy after completion of my internship and as odd as it may seem, ended up in commercial banking in my home country (Point72 doesn't have operations in the country where I am from / where I went to college in). I've not been enjoying my current role and have been miserable here. So I mustered the courage and applied for the Academy when applications reopened. Now, they've sent me a case study where I have to prepare a full investment memo (stock pitch) and comprehensive financial model from scratch. They've assigned me the company. It will have to be based on publicly available data. I have roughly 12 days at hand. 

This is a huge opportunity and could be a major turning point for me. I've been reading around this forum and some guides online on how best to approach this. Would love advice on how I should approach the financial modelling part. I have zero experience with financial modelling. I can't use any templates to build the model. How do I best use my time to deliver an optimum product? What resources do you suggest?

 

Based on the WSO Academy resources and the most helpful WSO content, here’s a structured approach to tackle your financial modeling task for the Point72 Academy case study:

  1. Understand the Basics of Financial Modeling: Since you have zero experience with financial modeling, start with the fundamentals. The WSO Financial Modeling Courses, particularly the Excel Modeling Course, can be a great starting point. These courses are designed to build a strong foundation in financial statement modeling, DCF, M&A, and more.

  2. Gather Information: Collect as much information as possible about the assigned company from public sources. This includes annual reports, quarterly reports, press releases, and industry news. Pay special attention to the financial statements, management discussion, and analysis sections.

  3. Build the Financial Model:

    • Historical Analysis: Input the historical financial data into Excel. Start with the income statement, balance sheet, and cash flow statement.
    • Assumptions: Make reasonable assumptions about future performance based on historical data and industry trends. This includes growth rates, margins, capital expenditures, and working capital needs.
    • Projections: Extend the financial statements into the future based on your assumptions. Typically, a 5-year projection is standard.
    • Valuation: Apply appropriate valuation techniques, such as Discounted Cash Flow (DCF) analysis or comparable company analysis, to estimate the intrinsic value of the company.
  4. Craft Your Investment Thesis: This should be a clear and concise statement that summarizes why the company is a good or bad investment. Include key drivers, risks, and potential returns.

  5. Prepare the Investment Memo: Structure your memo to include:

    • Recommendation: Start with your buy/sell/hold recommendation.
    • Company Overview: Brief background about the company.
    • Investment Thesis: Detailed explanation of your thesis.
    • Valuation: Summary of your valuation and the rationale behind it.
    • Risks: Discuss potential risks and mitigants.
  6. Review and Refine: Once your model and memo are drafted, review them multiple times. Check for errors in the Excel model and ensure your investment thesis is well-supported by the data.

  7. Practice Your Presentation: If you need to present your findings, practice your presentation. Be prepared to defend your assumptions and conclusions.

  8. Use Available Resources: While you can’t use templates, you can still learn from them. The WSO offers financial modeling templates that can help you understand how professional models are structured. Just ensure your final submission is your own work.

  9. Time Management: With 12 days at hand, plan your schedule meticulously. Allocate specific days for learning, building the model, writing the memo, and reviewing.

This structured approach should help you maximize your time and efforts in preparing a comprehensive financial model and investment memo for the Point72 Academy case study. Good luck!

Sources: How to improve earnings memo for interview, My Path - MBA Banking Associate to PE, Investment Banking to a Hedge fund... Can You Make the Jump?, VC investment memo examples?, Most academic style of investing that requires the most thought?

I'm an AI bot trained on the most helpful WSO content across 17+ years.
 

If you have no modelling xp this is going to be a massive waste of time 

 
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