Valuation spreadsheets for practice

Cincinnatus's picture
Rank: Chimp | 8

Hi Guys,

I'll be joining an investment firm as a consulting lateral hire, where I did a lot of macro modeling. However, the new job will require me to quickly pick up on the more practical business valuation models. I've been reviewing techniques but would like to put this into practice by valuing a couple of family businesses.

Can you suggest (perhaps even send) an excel-based model, preferably a set that includes DCF and a few others? Is it worth buying templates on the internet, or should I attempt to build one from scratch? I was looking at the McKinsey model on wileyvaluation.com, but the price ($165) seems a bit steep for a template. If this far and above the best template, I'll plunk down, but I have a feeling their are cheaper, better alternatives out there.

Much Obliged,
C

Comments (8)

Mar 6, 2009

you can PM me

Mar 7, 2009

Here's where I would look for free spreadsheets....

http://pages.stern.nyu.edu/~adamodar/New_Home_Page...
Damodaran is basically the man when it comes to this sort of thing.... He's a lecturer at Stern NYU.... the other information on his website is also good too...

http://pages.stern.nyu.edu/~adamodar/
Cheers

Mar 7, 2009

Damodaran IS the man. Thanks for the tip -- great resource.

Mar 7, 2009

No problems.... happy to be of assistance...

For a crash course I would recommend downloading the course notes for the executive education course on valuations... a bit shorter than the full course content wise but it cuts out all the 'nice to know but not used in the real world' stuff...

Also.... I happened to discover today (at my local bookstore) the McKinsey book that supports the spreadsheet you mentioned. I hadn't seen it before and I have to say I'm impressed.... mind you.... it is VERY McKinsey-esque (you're from consulting so you'll know what I mean)... Really depends on what you want - both Damodaran's lecture notes and the McKinsey book cover calculation plus strategy implications, but McKinsey is probably more explicit when it comes to the strategy side of things.

Cheers

Mar 8, 2009

I've been using the McKinsey book on valuation as a refresher, which has been a delight to read. I think it offers a very rigorous study (with various proofs and empirical studies) of how/what markets value, and also integrates well with the practical matters of managerial decision-making. It's been a great Consulting-Finance bridge for me.

I appreciate the first few chapters, where they offer proofs on the markets' deference for long-term economic value-creation vs. short-term accounting success. It was a nice reminder, particularly in this age of volatility. Let's hope logic collects the herd soon.

Mar 8, 2009

And for what it's worth, there are other lecturers who put up useful spreadsheets for their students.... From memory there is a Kellogg course that has a decent course website with documents/spreadsheets and the like.

Enjoy...

Mar 8, 2009
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