Most modeling-intense group?
What is the division/industry group where they do most modeling?
And in which of those are the most complex models usually done?
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Power / Renewables / Utilities / Infra for sure. FIG potentially up there as well.
This.
I have a job in CD at a power/utility company and my god is the modeling way more rigorous than anything else I have ever touched (compared to aerospace and defense, healthcare, railroads, consumer goods, professional service firms, etc). But it also makes sense. Because the operations are so tied to specific contracts, and the economics are what they are, you can do more detailed modeling. I swear my computer tries to off itself every time I open up Excel.
How does Restructuring position between those?
There’s a lot of overlap between restructuring and O&G / P&U. A lot of distressed activity in the off shore drilling sector and a lot of municipal / sovereign restructurings, ie Puerto Rico, involve P&U and infrastructure.
Product groups usually. CS FSG and BofA M&A come to mind
Also adding that most MM banks do very little modeling. Since most of their work is for sponsor clients, the sponsors usually have complex models built out
Can someone who works at a MM chime in on this? What kind of analyst experience does someone at a William Blair/Jefferies/Harris Williams get?
At one of the banks mentioned - not inaccurate necessarily. On two of my deals, we ran with the model the sponsor already had built out. For 4 of my deals I've built the model myself. Most are very simple models, although one of them was for a $1B+ company that had several business units and had done a few acquisitions, so was much more complex
Yea this dude is very, very wrong.
Any M&A group
Power / Nat Res / Energy. Some industrials sub sectors as well. And FIG.
.
M&A at BBs. You do no pitch work
This varies by bank - at my BB coverage groups holds pen on the model. M&A still does some model work, but it's bank-specific in how they split work with the coverage group
Okay, not Barcap or GS
That answers the first question. What about the second?
Exploration and Production / Power and Renewables / Infrastructure
I cover Renewables both debt and equity (Mostly early stage mezz debt) and there isnt a day that I dont model
Can I PM?
How is the modelling aspect of Consumer/Industrials/FIG?
I’m in consumer. Most modeling is fairly simple, but I’ve had two complex instances. Modeling a company that owned 150+ auto dealers given the differences between individual dealers and floorplan financing. Another situation I modeled a company with three completely unrelated business lines and an investment arm. Lots of analysis of each business line, but not necessarily hard.
FIG>Ind>CR
Is industrials modeling intensive? I’ve always thought of them as having relatively simple business models
The fashion vertical within C&R
Why is the fashion vertical complex to model? I could see maybe with upscale fashion given the limited supply and dependence on new product issuances, but not sure about the general vertical.
Woooooosh
Why are juniors obsessed with ‘complex modelling’?
Because that's what gets them in to PE, where after 3 years, their ability to model better than their peers nosedives rapidly down the list of desired characteristics for someone to be promoted to principal. Oh well.
Model is just a check the box exercise for us. A reason why you can get dinged but not one why you can get hired
M&A, Rx, FIG, O&G, Infra
What about LevFin?
Depends on if its part of capital markets or not
Oil and Gas and Metals and Mining are a pain in the ass if you have to model out every single site, its production, and its value on top of general corporate value. Might take a HF analyst half the whole day to update his model when a 10Q comes out for a company like Exxon
Power, Utilities, Renewables, Infra
Any time you pass a PUI analyst or associate on the street, please remove your hat and thank them for their service, because they are fighting night in and out a 60mb model with 100 tabs, thousands of lines, multiple macros where, by the way, every single assumption needs to be scrutinised in excruciating detail with multiple third party advisors as well as pass a model audit, for your freedoms to F9 some factset comps and slap a multiple on PF Adj. LTM EBITDA of a midwestern widget manufacturer.
Imo, regulated utilities are by far the easiest to model. You turn the income statement upside down, start with net income based on capex times equity layer and work backwards to revenue.
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