Globalisation increased penetration of the internet and the opening up of borders are just a few of the reasons why the business world is becoming more complex. It more difficult to assess todays business climate with the many more sources of financial and business information available than ever before. Likewise, it is becoming increasingly difficult to predict what will happen in the future, yet it is of utmost importance to come to sound financial decisions and recommendations. Euromoney Training's Company Analysis: Valuation, Forecasting and Modelling course is designed to provide you with a wide range of fundamental analytical and forecasting skills, which will be of relevance in today's business, banking and financial services world.

How will this course assist you?

This course will provide you with an in-depth and practical overview of financial analysis and forecasting techniques. During this 5-day training programme you will learn to:

• Value a company or investment using a variety of tools.
• Use basic financial modelling techniques in Excel.
• Understand discounting concepts, cost of capital and discounted cashflow analysis.
• Compare and contrast the various forecasting and analysis techniques.

Who Should Attend?

• Investment and Commercial Bankers
• Financial decision-makers in corporates
• Management Consultants
• Financial Analysts
• General Managers
• Credit Analysts
• Accountants
• Marketing Managers
• Operations Managers
• Project Managers

Supported by:

 

Day 1

Modelling

Overview

• Why create a model.
• Good modelling practices.
• Overall structure of the model.

Introductory model

• The three main statements.
• How they link up together.
• Completion of small model.

The main structure

• Historic P&L information.
• Restating historic information.
• Non-recurring items.
• Historic B / S information.
• Non-core assets.
• Review of initial model for case company.

Fixed assets

• Understanding capital intensity.
• Maintenance vs expansion Capex.
• Forecasting overall capex.
• Calculating depreciation.

Day 2

Modelling and ratio analysis

Working capital

• Components of cash and non-cash working capital.
• Working capital ratios and their interpretation.
• Forecasting working capital.

Associates and investments

• Accounting for associates and investments.
• Forecasting associates and investment income.
• Impact on cash flow and B/S.

Equity financing

• Minority interest- impact on equity financing.
• Common shareholders- forecasting dividends and retained earnings.
• Share buy-backs and rights issues.

Debt financing

• Linking cash flow and debt requirements.
• Different types of debt financing.
• Leasing vs ownership.
  – Scenario analysis.
  – Developing fully flexible scenarios.
  – Identifying the key variables.

Day 3

Comparable company analysis

Choosing appropriate comparable companies

• How the choice of comparables impacts the final valuation.
• Value drivers: understanding industry dynamics.
• Main factors affecting selection: size, geography, regulation, customers.
• Other factors affecting comparability, e.g. free-float, capital structure, corporate finance activity.

Equity vs enterprise value multiples

• Definitions.
• Calculating EV: core vs non-core, assessing liabilities.
• Calculating “recurring” earnings.

Equity multiples

• Main multiples: P / E and P / BV.
• Decomposing P / Es: linking growth, Cost of equity and RoE.
• Pros and cons of Equity multiples.

EV multiples

• Main EV multiples.
• Choosing the most relevant multiples.
• Pros and cons of EV multiples.
• Implied Valuation.
• Interpreting results and deriving an implied valuation for the target company.

Day 4

DCF and cost of capital

Cost of capital

• Why calculate a cost of capital.
• The risk / reward trade off.
• Impact of financial leverage on Value.
• Market risk vs company specific risk.
• Accounting for market risk: asset betas.
• Financial leverage and betas.

Equity investors

• Calculating cost of equity.
• Estimating the equity risk premium.

Debt financing

• Impact of taxation: the tax shield.
• Calculating the cost of debt.

Weighted Average ost of Capital

• Market value of debt and equity.
• Current vs target WACC.

DCF

Forecasting FCF

• Length of the explicit forecast period.
• Cyclical and growth companies.
• Calculating FCF: recurring vs growth FCF.
• Appropriate FCF.
• Forecasting of FCF for case company.

Day 5

DCF and overall valuation

Terminal value

• Beyond the initial period.
• When should FCF be normalised?
• TV using the perpetuity method.
• TV using the multiples method.
• Running sensitivities.
• Review of initial DCF model.

Value drivers

• Understanding ROCE.
• Components of capital employed.
• Decomposing ROCE.
• Value drivers and DCF.
• The link between ROCE, growth and WACC.
• Calculating TV using value drivers- compare with standard DCF.
  

Case study: participants will use the models they have built to analyse the performance of the target company and suggest a target share price.

• Sophie Blanpain-Forder

  Sophie Blanpain-Forder was the Global Head of Equity Research at Morley Fund Management, the third largest UK asset manager and one of the largest property fund managers in Europe. Prior to that she worked as Senior Analyst for the European Investment product division at Citibank N.A. where her main responsibilities included the design of new investment products and asset allocation. She also worked for Credit Lyonnais Securities, Credit Suisse First Boston and Lehman Brothers. Sophie graduated in 1990 from Institut d’Etudes Politiques de Paris with highest honours. She studied Economics and Finance specialising on Financial Tax Systems, Accounting and Financial Mathematics. She is also a retained speaker for the CFA institute.

  Courses run by this instructor

  • Advanced Company Analysis Valuation and Financial Modelling

Company Analysis: Valuation, Forecasting and Modelling

Interested in holding this course in-house? Please fill out your details and a member of our team will be in touch with more information.

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Oil & Gas Valuation

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