modeling as an intern
Is it that detrimental to not have much modeling experience going into FT recruiting from a summer internship at a regional boutique? I'd say that I've gotten a pretty good experience out of this internship (this boutique doesn't offer FT offers to interns), but my modeling experience has been limited to previous deals, basically re-doing old models as exercises, rather than working on live deals. I have a pretty decent understanding of how to create DCF and lbo models now, but I haven't had a chance to apply them to a live project.
Would it look weird to put DCF and LBO modeling experience on my resume while noting that it wasn't for live deals?
Would the banks know that they weren't live deals? I would think you could write that you did DCF and LBO modeling and say that you worked on certain deals and no one would know it wasn't a live deal. If it somehow comes up in an interview that you didn't work on a live deal you could probably say you were just listing what you did during your SA stint and that your internship employer had you rework models from past deals to develop your modeling skills. That would probably be a good enough answer. I guess what I'm trying to say is were these deals high profile enough that people would know immediately you didn't work on them when they were "live"? If they aren't you can probably do what I just said and be fine. If they are you should be very clear on your resume that you reworked old models.
its not what you did. its what you can make them believe you did.
As an intern, nobody cares - for FT recruiting you just maybe put bullets for whatever transactions you worked on and put "Introduction to 3-statement modeling, LBO, etc." -- first off it doesnt matter for FT recruiting (you'll get plenty of modeling as an analyst) and no matter what you put its inconsequential becuase they wont ask you about it and no matter what you think you know you dont know much.
So in short, its not detrimental. You're fine. Internships are BS anyways so just get through it, get a job and coast out senior year.
What is a DCF model anyway? Sorry to derail the thread. I know what a DCF is and how to do it. I dont understand what everyone means by modeling it. Modeling it off a company? I have googled this.
Basically, 'modeling' just refers to setting it up in Excel. Instead of using a pencil and a calculator and a piece of paper you set it up in Excel. If you get a chance to see a full blow model you will see why it is done in Excel instead of a 100 sheet college ruled notebook.
Excel just makes life easier to look at the numbers and create graphs, charts, returns analysis, things of that nature...as opposed to doing it all on your own.
Models generally consist of lots of information and appear complex but are actually relatively simply when you become familiar with them. They often are just made up of the financial statements, the various valuations methods, proforma financial statements (read: projections), and any number of other things that are going to help display the value of a company (charts, graphs, margins, etc).
And don't get me wrong, LBOs and the like get very intricate and can be rather complex, but again, its just a big puzzle made up of a bunch of smaller pieces.
Do yourself a favor and get the Breaking Into Wall Street financial modeling guides (if you have the money), if not, go onto YouTube and look up 'investment banking financial modeling' and there are some videos that different people have posted that will at least show you what it looks like, so you have a general idea.
Regards
you project the free cash flow of any company or division of a company and then discount the value of those cash flows into the present. you also have to calculate the terminal value of the company and discount this back to the present as well. you then sum the discounted cash flows and the terminal value to arrive at your implied enterprise value.
subtract net debt, preferred, and noncontrolling and your at equity value. divide by shares outstanding and you have your implied price per share.
if you wanna do one, i would suggest projecting the bs, is, and cash flow statements about 5 years into the future. this is because you'll need to project changes in working capital, capital expenditures, depreciation / amortization, etc.
Thanks guys will do!
SAs get to construct financial models? (Originally Posted: 03/05/2009)
Do SAs get to build models with some guidance? or not at all?
I was a soph SA and I didn't get to create shit. I used pre-existing models and tweaked them, and YOUR MODEL WILL ALWAYS BE WRONG. At best, it'll be one less level of fixing
not really...
Talk with an analyst and see if you could sit down with them when they actually make a model... then try to recreate some on your own by scratch. I'd even talk to an analyst that you know and ask them if you can try to create the same model as them (the next time) and to compare the end products to see if you did it correctly. This will show them that you know how to do it, and if your numbers all match up, they will know that you can do it RIGHT. In the event that they are completely bogged down w/ work including models and want to get home, there's a very slight chance that they may one day have you make the model (it's unlikely, but possible).
You're more likely to spend time researching / making a comps sheet and building pitchbooks and PowerPoints. Most analysts don't trust SAs to build models.
If you're interning at MoCo, CS LA or UBS LA for instance, you will definitely get your fair share of modeling experience. They'll be basic models, but you will build them from scratch and you will eventually build them on your own. Towards the ends, if they're not right, hah, enjoy the ownage...
ditto
The world has changed. And we must change with it.
Depends on the group / staffing level / deal team. Some SAs in my group last summer got to build LBO models, but not all. Those who were perceived to be "good" were given more responsibilities and some directors / ADs were more comfortable giving meaningful work to SAs - hm, self-fulfilling prophecy...
I Was a SA at BB last year and myself and well as another SA in my group both seperately built combo models with accrec/dil for a potential deal. We obviously had people helping us out and checking it but it was our model respecitvely
How about HLHZ FAS?
Modeling Experience as a Summer Analyst (Originally Posted: 02/05/2010)
Hey everyone,
Now that recruiting season has wrapped up at some (if not most schools), was wondering what everyone's thoughts were on actual modeling experience.
Do summer analysts, even ones in M&A, LevFin, Sponsors actually get to touch models? To be honest, during a stint last year at a BB, I did essentially 0 modeling. 90% of the work involved logistics, making powerpoints look pretty, and typing up memos. Was this a typical experience?
How would you guys suggest a summer analyst approach a busy analyst/associate who just wants to go home about wanting to learn more about modeling? I get a sense that FT recruiting and SA recruiting (for kids with BB exp) is a LOT more technical than normal SA interviews.
Please share your experiences!
My SA experience involved some models - maybe not a 40 tab beast but definitely something I could intelligently talk about in an interview. One of those was courtesy of an associate and VP who were really interested in teaching me about the company and process and another happened (changing an existing big model's functionality) because the analyst on the project had a ton on his plate.
However, don't fret if that's not the case - I would just go into the model on a project (pref. one that you're familiar with) and see how it works, both from the finance and from the Excel perspective. After you've done that, try to rebuild it yourself from scratch and see how you do. This even applies to templates, since you get a good understanding only after rebuilding a template of what it's really doing.
I didn't do FT recruiting, so I can't personally speak to how technical FT interviews are after BB SA.
if you don't mind sharing, what bank did you summer at?
I'd rather not share, but if you try you can probably figure it out from my post history.
If you're going to give him that hint, you might as well just tell him..
Modelling as an Intern (Originally Posted: 02/04/2013)
Hey Monkeys,
I have just accepted an IB Summer analyst position at a BB for the summer. I am really excited for the opportunity and want to make sure I prepare myself in order to take full advantage of it.
I am from a completely non-target school; finance is pretty small here, and I am not even sure how many of my profs would know what investment banking is (yeah, that small). I was wondering how much modelling are interns expected to know prior to their work term? The bank I will be at has a formal training period, so that is definitely reassuring, but I was wondering if some of the target school-kids might already have a lot of modelling experience and if I will be starting out at a big disadvantage.
Thanks for any feedback/opinions on this, much appreciated
That's awesome, thanks a lot for the input
HarvardOrBust is pretty spot on...
I worked at a no name boutique and I had a chance to model a couple times during my 12 wks there. I was fortunate because I was doing a good job - not perfect but learning from mistakes and progressively getting better which helped me earn the trust of others. If you keep making mistakes though you will lose your peers' trust and continue to do just grunt work. The other intern I worked with had this issue and did not get to model at all ... unfortunately stuck doing just BS pitches and company profiles. Moral of the story: make a good first impression, show improvement, ask good questions, etc...
I still laugh about this: A guy I know was at a good energy boutique as a summer.
One day near the end of the program he goes for lunch and forgets to lock his computer. The assocs come through and after backing everything up, wipe his computer clean. He gets back from lunch, panics, terrified that since he's lost all this work they'll think he was useless and he won't get an offer. The assocs watch for a bit, then tell him that they've got his stuff. Then they tell him, 'it wouldn't have mattered if it was lost, you don't really think that we'd give anything that was important to an intern do you?'
If you have a few extra bucks sitting around you should pick up Scoop Books guide to IB and Corp Fin as it will give you a huge advantage. Also learn as much excel and powerpoint as you can Best of luck.
It completely depends on the group you're in. Last summer I got almost no modeling experience (was in product BB, but capital markets-ish). This summer I'll be silo'd doing M&A for a coverage group, and the director explicitly told me that the group would be in touch at least a month before training to walk me through their models so that I'd be up to speed on the first day of the job.
triplectz - thats awesome! hope you get a great experience. Are you summer analyst or summmer associate level?
junkbondswap - I just checked out the Scoopbook, seems like there is a lot of valuable material. How much more valuable than the Vault guide would you say it is? Worth the $ ?
overpaid_overworked - hilarious story, but at the same time just making me nervous for the summer haha. Hoping for the best
"junkbondswap - I just checked out the Scoopbook, seems like there is a lot of valuable material. How much more valuable than the Vault guide would you say it is? Worth the $ ?"
im interested in this too. Which is the better read? Do both cover the same general things or are they completely different?
If this is turning into an advice column for SAs: For fucks sake, don't ask the same question, or a very similar question twice. Had a summer ask me the difference between gross and net acres, come back two days later and ask the difference between gross and net wells. Same effin kid told me that he wasn't interested in populating data tables, he was more of a big picture thinker, and he should be doing that rather work on that then data entry.
Unfortunately, I have never read the vault guide so cannot provide a comparison but the Scoop books is one of the few resources that I have used throughout my career. I came from a non-traditional background with limited exposure to finance and found the book to be easy to understand and very thorough. Several years later (after building a successful career and gaining a great deal of experience) I still recommend it as the best resource. $100 can buy plenty of booze in college but I found it to be a good investment. Maybe you can find a used version. Book covers everything you will need to understand in IB: major players, different groups, relevant valuation (comps, precedent transactions, DCF, LBO, etc.), deal cycle (pitching/bake-off, winning the mandate, etc.) along with solid foundations in corp finance and accounting/financial statement analysis.
Modeling - Worth mastering as a SA (Originally Posted: 03/02/2013)
Just curious, is there any models that are even worth mastering as a SA for BB PWM? I have no chance at IB so I am trying to do everything I can to get a FT offer through my SA.
Is there any other avenues to attack after a pwm internship other than pwm?
PWMs don't model
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