What does “they don’t touch the model” mean
Hi everyone. When reading some threads to learn about product vs. coverage groups, I noticed some talk about how sometimes coverage groups “don’t touch the model”. Could someone explain briefly what that means in terms of work responsibilities, etc. Also, I think I read about some banks having integration between product and coverage teams i.e. a group does their own M&A. What does that mean from a practical standpoint?
At some firms there is a clear division of responsibility between the coverage (industry) team and the M&A (execution) team.
Coverage will be responsible for more industry-related tasks which some may deem as less “technical” (industry pages, comps, etc)
In a live-transaction, the M&A team is more (or solely) responsible for the valuation and operating models.
That is one model. At some firms there is a separate M&A team but certain industry teams still do their modeling in-house. At some firms, there is no separate M&A team so that responsibility belongs to the industry team
Given analysts’ focus on exit opportunities, there is a natural gravitation to M&A / modeling rich experiences where they’ll get more technical exposure and be more attractive to the buyside
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