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Bruce Greenwald's Valuation method and capitalising expenses (operating leases, marketing, ect).
Hi guys, After reading Bruce Greenwald's books, I've begun valuing companies using his method of valuation (Liquidation/Reproduction values, EPV, Growth). However, I've only just recently started university so I'm still a bit clueless regarding a lot of these things. I've also read Aswath...
DCF - How do you come up with your Terminal Growth Rate?
I know how to find the terminal value, this question is about estimating the terminal growth rate... I have used the search bar and can't find a definitive answer. I have been told that it should be GDP growth rate +/- your estimate. Anyone else ever hears this? I know that it should be somewhere...
Valuation tools survey: DCF vs Multiples
just out of curiosity, in real life, shops tend to use DCF , Multiples or a mix of both? i understand both of them have their shortcomings and that maybe especially in the Sell Side Multiples are preferred because it's much easier to give a simple answer to the client (given all the inputs a DCF...
Performance Rights
Hey guys, I have a question regarding the treatment of performance rights when valuing a company. I know that with options, unless the exercise price is above the current share price, they are not counted towards diluted equity value . However, how does one treat performance rights? My first...
Interest rate on debt
Hello, Firstly, I apologise if this is in the wrong section. I'm not quite sure where else to post it. I've just started university and begun teaching myself financial modelling . I've been doing well, however, I've had trouble figuring out the interest rate on debt for some companies. I can...
McGladrey/Grant Thornton Valuation better than Big 4 Audit?
Hey guys, I'm currently planning to start my career in Big 4 audit ( PwC ), but hope to eventually end up in investment banking. I've read numerous posts saying the best way to do that is to transfer into TS/TAS and move from there (whether it's jumping straight to a bank to into a Top MBA). From...
How can you value a company from a debt standpoint?
I have a fixed income interview tomorrow and in the first round they asked me something like this. I wasn't entirely sure and I would like to be this time.
Real case of a valuation fraud from an expert. Some advice needed.
Hi guys. This is a real case and there is a trial going on (in eastern Europe ), I would like some hints from you and maybe even some help based on International valuation standards. There are 2 companies: Company A has 21 mil cash in bank, that's all the assets. Company B has a hotel, a pool, some...
2 classes of shares in an acquisition - valuation question
So just out of curiosity, what happens what the Acquirer acquires a company that has 2 classes of shares? Say Class A and Class B, both traded on the exchange but the different is Class A is held closely by say 10 shareholders (30 shares o/s) and Class B is the one that’s mainly traded (500 shares...
Casino Valuation
I'm a beginner to real estate, so was wondering if anyone here could provide some basics on how to value a casino. Alternatively, are there any good resources on how to do so that I can read up on? Thanks in advance.
Obscure Valuation Question
Hi all, just a quick, somewhat obscure valuation question that I was asked in an interview: "Consider this scenario-- A songwriter is paid a $2mm advance from music publishing company to acquire 25% of the writer's songwriting income for 10 years. The songwriter retains 75% ownership. The...
Private banking valuation
Does anyone have a good resource on private banking valuation or at least a good resource on the private banking industry, revenue drivers, regulation etc?
How far are your projections and where do you get quality inputs
Hi all, I have 2 questions: 1. Most books and resources I've read said that projecting earnings and financials more than 2 years away is not ideal, mainly because there is less basis to really judge cash flows so far away. My question is that I often only see earning estimates from reports 1-2 years...
Real Life Case Study: What is the value of this 4 Tenant Retail property in Long Island?
I have an associate who co-owns (50% undivided interest) a 4 tenant, Class B Retail property in a middle (to working) class Long Island residential area which generates $16,000 a month total NOI with NNN leases. The leases all have 5-10 years left to run with a good probability of renewal across the...
Valuation questions
Hi guys, I am a novice at valuation, just getting into finance. Wanted to ask if you guys could help me out understanding how to calculate these things: 1) Company financials: EV / EBITDA = 8x, P/E = 15x, net earnings = 100, net debt = 50 - how do you calculate EV , equity value and EBITDA of this...
M&A Transaction Timeline
I feel like there is a huge misconception about the timeline of M&A transactions and the functions carried out by affiliated parties during the process. Private Equity M&A Process Timeline Therefore, I would like to assume the following scenario in order to illustrate the entire process: A private...
A Firm's Value
Have you ever wondered how investment banks or financial advisors calculate a firm’s value exactly? In order to evaluate company X during an M&A transaction, a peer group of comparable companies (Company A and Company B) have to be selected. Subsequently, various key performance indicators have to...
Valuation of a university
I did an exercise on valuation of a university during my internship last year. I was going through my notes and was wondering whether I did it right or wrong. So, it would of a great help if anyone who has done a similar exercise can share his/her experiences and the methods that they used.
A new semester begins: Valuation class online
If you are a teacher, you measure your life in quarters and semesters. This is my fiftieth semester teaching, and, as in each of the prior forty nine semesters, I could not wait to get started. Coddled as only tenured faculty at a research university can be, I have only one class to teach this...
Find Equity Research in UK
Hi everyone, So I know that a lot of you in the USA use TD Ameritrade to find Credit Suisse equity research . Where can I find reports in the UK? Which brokerage firms in the UK offer good quality research and require minimal deposit with no added costs? Thanks in advance
The true purpose of calculating Enterprise Value
Hi guys, Some sources call EV the "price that an acquirer really pays''. But in reality the purchase price is always the stock price plus certain premium. Does it mean that EV is just a 'theoretical price' for the business? If so why do we go through all the trouble gauging a company's EV ,...
Financial Modeling and Valuation: A Practical Guide to Investment Banking and Private Equity
Financial Modeling and Valuation: A Practical Guide to Investment Banking and Private Equity looks like modeling 101. Written by Paul Pignataro, founder of New York School of Finance, this book promises to be a must read for all high-finance prospects. From glancing through the preview, it looks...
Insurance Company Valuation: Useful Resources
I currently work in the insurance industry and am trying to break into banking. While I am trying to network with as many industry professionals as possible, in my mind it makes sense to try and network with FIG bankers, FIG focused shops (e.g. KBW , Sandler + O'Neil) and FIG /Insurance/Reinsurance...
How to apply the LBO model?
Dear all,
How to Get to ARGUS Certification?
Now that there's a dedicated RE forum I feel like we should have an Argus thread. Argus website here: Argus Software I've talked to a few people in the industry over the past week and they have stressed how important an Argus certification will be to break in straight from undergrad. Being a student...
Where to find WACC?
Don't have access to Bloomberg or any other paid subscription services, so was wondering if anyone knows any free sites where you can find public companies WACC ? Wikiwealth does it, but their method of calculation doesnt seem the most accurate.
Preparation for valuation
Have an interview coming up and a part of it is to do a test on valuation, I assume it will be data on some companies and performing valuation for this.. any idea the best way to prepare?
BDO Consulting - Valuation
Hello, At this time, I am going for entry valuation position at BDO. Does anyone know how technical interview for Valuation Associate can get? Would they rather look for fit? Also, what are exit ops from Valuation type of positions and how can you transition into banking? Thanks in advance!
For all you Val guys...
I'm starting at a boutique IB /Val firm in their val department and am looking to be the top guy from day one. Anything you guys recommend I brush up on or practice? I hear it's pretty modeling heavy. Any specific "do it yourself" modeling courses you suggest? What books should I familiarize myself...
Governments and Value: Part 1 - Nationalization Risk
I have been writing about valuation for a long time and for much of that time period, I chose to ignore the effects, positive or negative, that governments can have on the value of businesses. Implicitly, I was assuming that governments could affect the value of a business only through the tax code...
Is Dynamic Pricing the Wave of the Future?
Before two weeks ago, I hadn't given the dynamic pricing of consumer goods and services much thought. I suspect that's mostly because it doesn't exist for the most part outside of travel-related products such as airfare. However, I was in Frankfurt two weeks ago and met the owner of two convenience...
Texas Railroad Commission O&G Production #'s
This a big time long shot. But any O&G hedge fund studs out there now how to reconcile TRC reported O&G production #'s w/ company provided well head reports? Bigger stretch, w/ engineering reports (not third party)? I fired up AIRES, used the targets exact case assumptions and historical well test...
Bang your friends
What's the value of "Bang your friends"? Does it have a value? 20K users in a week... http://www.nbcbayarea.com/blogs/press-here/Facebook-is-Now-All-About-th…
Financial modeling course for fundamental long term investing
I'm looking for a financial modeling course to do at home in the evenings, and I have noticed that most of what's available out there tends to lay on the lbo /merger side of things. So wondering if anyone knows a good one to prepare for roles in fundamental long term investing (value-style). Many...
Insurance Industry Multiples
Anyone know what multiples are popular for valuation of insurers, specifically conglomerate-types (i.e. Allstate, State Farm, etc.)? Wasn't sure if P/BV or P/TBV were favored over EV / EBITDA or any other metrics. Thanks in advance.
Valuation_help
I got interested in Valuation . Would any suggest me with some books or softwareI can use? Both for assets or business entity will be really helpful. I know substaintial about accounting both management and financial accounting, done a couple of securities valuation researches, but don't have...
Deriving future spot rate from bonds
Hi, I have a question that I am stuck on. Calculate the 6 year spot rate from the following. Bond 1 - 6 percent six-year bond yields 12 percent and Bond 2- 10 percent six-year bond yields 8 percent. ----- I'm not sure how to do this... I have done the first step which is to value the bonds so: Bond...
Valuation derivatives instruments
I'm doing a DCF calculation but how can I forecast financial derivatives? It currently has a fair value of -100. And -50 of this fair value expires next year, and -50 expires the year thereafter. How can I forecast this, can I just discount the -50 cash outflows? Thanks.
Valuing Non-operating/vacant or Negative Cash-flowing Property
How would you go about doing this? Can't use income approach. If using comp sales approach would you look for properties not only of the same type but in the same state? - which may be a tough bet. Seems replacement approach would be the way to go?
Books on Bank valuation
Hey guys! I'm interviewing with a FIG group and need to read up on bank valuation specifically and FI valuation in general. I am looking for a Rosenbaum -style book, such as Bank Valuation for dummies. Any recommendations? Cheers LeeteasY
Revenue and Cost Schedules
Are revenue and cost schedule breakdowns educated guesses or has this information, which is not included in 10 K's, been acquired directly from the company's management?
IPO Valuation: power utility IPO? - What key drivers to consider?
Primates, How would you best value a power utility IPO? would you go for DCF or multiples? or a mix of both? What key drivers would you consider? All views are welcome
Hamada formula
Hi guys, When we use the Hamada formula to re-lever an unlevered beta, what do we use as equity value since it is the target of our valuation? Should we use the average capital structure of our comparables sample? If we do it this way, wouldn't we end up with the same levered beta we had at the...
Implied Future Cash Flows
I see a lot about discounted cash flow and net present value but I wonder if a metric like implied cash flow is used? Kind of like how options give implied probabilities. I don't know if this is a standard term since I didn't see anything directly relevant on google. This could be all nonsense since...
IBD case competition
Hi, I'm a sophomore at a target school majoring in econ and math. Postings about case competition (and the like) held by IBDs are up on our website, but since I'm an econ major I have no knowledge about finance (no finance course in our school), let alone valuation methods, LBO , DCF and all the...
PwC TS vs Duff & Phelps Valuation
I know the type of work (purchase price allocations, goodwill impairments, stock option valuations) are pretty much the same, but is there any general difference in brand name/compensation between these two groups? Trying to determine which one would be better to start a career at.
EBITDA Multiples - Medical Supply Resellers - Help Needed
Does anyone know any free resources online to find industry average EBITDA multiples, specifically for medical supply companies? I need to figure out how to value a small medical supply reseller that does below around $100M in EBITDA . Does anyone have any places online where you go to find ideas of...
Even Bother with Ibanking/S&T at BB Full-Time?
Hey so I go to a target (not the best one), and last summer I worked for a somewhat well-known valuation shop. There aren't that many BBs even posting on our career site for FT positions in IB or S&T , so I was wondering if I should even bother applying for these positions at BBs or if I should...
uValue - Analysts Are Now Irrelevant
So I just came across this free iPad app called uValue. Its created by a couple of professors at Stern and Dartmouth Business School and is essentially a skinned spreadsheet which values companies. It can do WACC (detailed and simple), APV (detailed and simple), dividend growth and even value...
Zynga IPO Valuation
In playing the Social Media Bubble game, it was inevitable that Zynga's turn would come up. The forever delayed IPO seemed destined for big numbers as a recently as a month ago...and a few months before that...and a few months before that. Things have changed quite a bit as of late and there are...
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