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IRR with Dividend Recap
How do you calculate IRR when there are interim cash flows like the scenario where a PE firm does a dividend recap in year 3 and exits in year 5? I know excel can do it for you with the IRR function, but what is the actual formula? How is excel calculating that?
How would mortgage payments affect IRR?
How would mortgage payments affect IRR ?
Is there an IRR formula
I am told there are no IRR formulas when number of cash flows excess 5 Is it so? Is there an IRR formula to find internal rate of return when number of cash flows exceed 5? For example, is it possible to find IRR of the following investment using a "formula" rather than "iterative methods" -100, 50,...
Finding an alternative investment that has the same IRR
If one is given a set of cash flows that are in uneven amounts, is there a way to find an alternative investment (one that has a different set of uneven cash flows) that has the same IRR - internal rate of return as that of the original investment. For example Investment A -100, 50, 40, 30, 10...
Calculating IRR on an acquisition with immediate cash flow...
I am trying to figure out the best way to model cash flows for an acquisition that will have immediate cash flows. These are residential rental portfolios, so the day we acquire the property we begin "receiving"cash flow. Do I put the initial acquisition costs (the equity) in a separate year 0...
Using Bloomberg to find PE/VC performance/analytics????
Hello everyone, I currently completing a case study for a PE fund of funds interview. Essentially I am to pick 2 of 6 PE firms to invest with if they were to raise a new fund today, so I am trying to find the historic returns and any other data I could use to compare the funds of these firms to PE...
Read 500 Pages Per Day
Investors are constantly looking for nuggets of wisdom from the Oracle of Omaha, Warren Buffett, so this tidbit on Omaha.com caught our eye. It's just one quote from Buffett. He was at a 165 person Columbia University investing class, and one of the students asked him how to prepare for a career in...
IRR vs UFCF. whats the difference!
can someone explain to me the difference between IRR vs UFCF vs LFCF? Thanks very much!
Calculating Fund IRR after recent portfolio IPO
Hi All, Unfamiliar situation for me here. We recently IPO'd a company that has done extremely well post going public (Up 300%-400% from pricing). We now need to calculate the fund IRR as of 9/30/13. The one portfolio company has done so well, it's moving the IRR number over 10%+ from last quarter to...
LBO Models in Your Head
Has anyone ever been asked to do an LBO and M&A models off the top of their head? Pen & Paper given with financials on a sheet but not much time (around 3 minutes) to calculate and walk through answer. Basically you have to calculate as you go through.
Cap rates vs. IRR
What's the difference between them? Do you use cap rates or IRR to value RE assets? Wouldn't it make sense to go for a a project with a cap rate of say 15%? How do you fundamentally calculate cap rates? and I dont mean income/purchase price....is it essentially IRR-expected growth? Just looking for...
Confused with IRR and YTM of a bond
Hi guys, I have a very simple question that has been confusing me a bit recently. The best way to describe it is to give a simple example. Let's imagine a very simple 5 year %10 Annual Coupon Bond trading at 100. The current interest rate on similar securities on the market is also %10, that is YTM...
Linking DCF to IRR analysis
Hi guys, I need a help! i just finished building my dcf model. My boss asked me what is the IRR return? How can i calculate that? the purpose of my DCF model is to find out how much i should pay for that company. but i dont know how to figure the IRR return. is the Cost of the equity is the IRR...
Cash Multiple to IRR
First time I (and the office) have seen this so am just sounding out WSO . To calc. IRR by (cash multiple)^(1 / time period) -1, is this common? best practice? or just lazy? Cheers for any input. How To Calculate IRR Manually Since you can’t calculate IRR by hand, unless you use a trial and error...
Institutional Real Estate investing - cash flow model
Hi! I am looking for someone who is familiar with institutional real estate investing in the Commercial Real Estate space. In the last days I have spent some time to find how deal structures look like in that segment. Especially how the refinancing of such an invesment is structured (I undertand...
Corporate Finance - IRR Calc
When LBO modeling for a private equity fund, you typically use an exit mulitple of EBITDA / revenue / some industry metric for the terminal value to calculate the cash inflows for the IRR calc. For a corporatation, which isn't in the business of flipping companies, how is the terminal value cash...
IRR Funds vs Funds of funds
Hello, I am looking for the differences from an LP point of view between investing in PE Fund vs investing in Fund of Fund. Let's assume (purely hypothetical) that an LP had the choice to invest in a fund OR a fund of fund which have exactly the same simplified characteristics (again it's just...
Calculating and Estimating Internal Rate of Return
Whats the best way to do an IRR calc in your head? is there a simple calculation and relationship when you think about initial investment, sale price and time period? just for back of envelope calcs when youre sitting in a meeting or an interview. thank you How To Calculate Internal Rate of Return...
LBO Sensitivity Question (data tables)
So I am somewhat new to LBO modeling as we don't really do it at my firm but I am trying to learn because I find it interesting and eventually want to end up in PE . I work with data tables to perform sensitivities every day, but in the context of a LBO there are a few things I cannot figure out and...
quick questions on control premium, IRRs, LBO
hey all, im preparing for FT interviews and have a few quick technical questions. 1) why do companies pay a control premium for a target company, and how do they decide how much to pay? is it simply through the bidding process? 2) at the company i worked for, some of the LBO models i worked on (with...
Equity IRR
What is the way to calculate "Equity IRR " as opposed to Project IRR which is the standard IRR . We all know how to calculate the standard IRR which would be defined as the discount rate where inflows=outflows but this term is something i've come across though not exactly sure how to calculate it....
IRR vs. equity return
Hi, I have a very basic question as I'm preparing for PE interviews - and I am embarrassed to ask people at work. Basically, some sample models I see show equity returns in an LBO model - i.e. using the rate function in excel, the purchase price equity and the exit equity value . This takes into...
Question regarding IRR of a small company
Fellow monkeys,
Question about IRR
Fellow monkeys, I was wondering if anyone knew how to calculate IRR if given EBITDA , Revenues, and Expenses for say years 5,6 and 7 of a certain project, with a terminal value of 1 year ebitda . Does anyone know the equation or how to do this in excel? I figured EBITDA would just be used as cash...
IRR for Health Club
I work in Corp Fin for one of the largest healthclubs (think Chap 11) and am working on a new club IRR analysis. The problem that I am having is whether or not to include non-cash rent in my analysis, and whether to have t=0 the first month non-cash appears. The problem I know is that IRR is a...
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