Hi!
I've been tasked with creating a DCF for a fiber rollout across 5 cities. Clearly the initial capex is high and is creating a lot of negative FCFs and consequently a negative EV?
How long should my forecast be? Should I still be doing a terminal value or just a very long 20+ year utility like forecast?
Thanks so much!
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Honestly how do you get jobs in the industry if you don’t even know how to create a DCF for the easiest to model TMT asset class?
The interview questions don't typically require grads to know the specifics of a fiber rollout... thanks for the help
I don’t believe you are a grad. Grads start in July but before hitting the desks, they are sent to training for a month and a half.
Honestly, how did you get a job as an associate when not being able to guide/be helpful to people more junior than you? Oh, I forgot :)
Regarding easiest asset class, boy, sure you are an assoc? For sure never built models in that industry if you think that digital infra is easier than say publishing lol
It’s not in my job description to explain to you or your friend how to model TMT asset classes.
Type whatever you want little Internet warrior. I don’t really care
Just drag the model to the right - assume something like a 30 year lifespan for fiber. That being said, I’d the payback period is more than like 5-7 years, it’s a shitty business model
Thank you I dragged it out to the right and as you said payback is way off that 5-7 horizon. The only thing getting it to look reasonable is substantially decreasing the cost to pass a home or loading it up with debt...
Often times they’re financed 100% by debt - that being said - there’s also a reason fiber isn’t everywhere. It’s fucking expensive. If the cost per home doesn’t work then it doesn’t work and there’s a reason providers haven’t built out to that area yet
should not be a negative EV
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