Looking at an Investment - Interview Question

Hi All. Am needing guidance on how to answer the question below. Anything you can share would be greatly appreciated!

If we were looking at an investment in X sector, where would you start your research and analysis?

My thinking is that you would

  1. Start with researching the market (ensure it is large and growing), low barriers to entry, fragmented competition, etc.
  2. Look at target company to ensure that fit the Company's investment criteria (strong leadership, unique competitive advantage in the sector, history of strong performance via historic CF (absent of volatility), relationship with customers, reasonable level of debt etc.
  3. Develop an indicative model based on pubicly available information
  4. Consult with industry advisers to get their point of view of the market and target company
  5. Refine analysis based on input from advisers
2 Comments
 

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