How long does a valuation take you (from scratch)
In search for a benchmark I was wondering how long it would take you to value a company (e.g. DCF analysis) from scratch. I.e. no access to Bloomberg, no template etc.
I just realized that pretty much all my prep work consisted of reading books and solving practice exercises, but I somehow haven't tried to value a single company yet.
Very much depends on the purpose. Anything between 15 minutes for a back of the envelope idea test to weeks/months for large buy-side.
Thanks! I was more referring to a case, where you want to corroborate your personal stand on a certain stock/company rather than an buy-side advisory engagement. However, 15 minutes is still pretty fast considering all the information/assumptions that go into a dcf.
Building a mechanically-sound operating model and DCF from scratch usually doesn't take very long; it can easily be done in a couple of hours - including formatting - at least for mature companies with simple capital structures. If you just want practice, it's fine to just throw in some arbitrary assumptions to get the mechanics of the model down. But understand that the bulk of efforts in practice should be spent making good assumptions and justifying them.
That's what I assumed. There are so many assumptions to make and being able to base all of them on 'facts' should require a ton of research.
In my case I was more referring to practicing on a more superficial level, as it's actually ridiculous that I've never done one from scratch so far.
~9hrs. 2 minutes to email the analyst. 8 hours to sleep. 1hr to check/fix in the morning.
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