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Essentials of Valuation and Financial Modeling

TTS offers two great formats for this training; weekend courses which cover 4 full days or the same content covered in 8 evening sessions.

Course Outline

Days 1&2: Financial Statement Analysis and Core Valuation Methodologies

  • Analyzing a company’s income statement, balance sheet and cash flow statement
  • Why bankers stress the importance of EBIT and EBITDA
  • Calculation and decoding of financial ratios
  • Normalizing for non-recurring items
  • Calculating margins, growth rates, credit ratios
  • Interpreting footnotes and management discussions & analysis

Public comparables analysis

  • Choosing a peer group
    • Gathering public information (sources and SEC documents overview)
    • Spreading comparables – calculating Market and Enterprise Value, normalizing  for non-recurring items, inputting the numbers, LTM, calculating multiples

Acquisition comparables analysis

  • Choosing a deal list
  • Concept of control premiums and synergies
  • Sample transaction list

Discounted cash flow analysis

  • Strengths and considerations of a DCF analysis
  • Deriving a weighted average cost of capital (WACC)
  • Discounting unlevered free cash flows
  • Estimating the terminal value (exit multiple vs. perpetuity growth rate approach)
  • Determining the valuation range

Days 3&4: Financial Modeling

Modeling Best Practices

  • Establishing modeling standards of consistency, efficiency and clarity
  • Introduction to short-cut keys and other Excel settings for efficiency
  • The “good, the bad and the ugly” of model formats and layouts
  • Creating flexible formulas, calculations and projections
  • Auditing financial models
  • Installation and functionality of TTS Marcos

Building an Integrated Financial Model

  • Setting up and road mapping the modeling process
  • Efficiencies with entering and analyzing historical financials
  • Projecting revenues and operating performance
  • Constructing the balance sheet and cash flow statement
  • Forecasting operating/working capital

Days 5&6:  Financial Modeling

Building an Integrated Financial Model – continued

  • Projecting PP&E and intangible assets
  • Calculating cash flow from investing activities
  • Forecasting other long-term items
  • Building a detailed equity & shares schedule
  • Understanding the core accounting relationships when building an integrated model
  • Debt & interest schedule
  • Setting up a “cash sweep” for excess cash and building complex deficit financing options
  • Trouble shooting your model: controlling for circular references, balancing models, and making the model “deal ready”
  • Constructing and utilizing data tables to perform sensitivity analysis
  • Using your model in a “real world” deal situation including a DCF application

Days 7&8: Merger Consequences and Leveraged Buyout Analyses

Merger Consequences Analysis

  • Overview of purchase accounting
  • Allocating the purchase price and creation of goodwill
  • Sample merger consequences impact: transaction assumptions, sources and uses, opening balance sheet, pro-forma income statement
  • M&A transaction considerations (stock vs. cash, social issues, etc.) and their impact on the financial statements
  • Break-even synergies and PE analysis
  • Key concepts and analysis: accretion / dilution, pro forma leverage and coverage ratios

Leveraged Buyout Analysis

  • Concept of an LBO and de-leveraging
  • LBO math
  • Capital structure determination
  • Utilizing a revolving credit facility and cash sweep
  • The characteristics of the different debt instruments
  • Differing viewpoints for LBO constituents
  • Internal rate of return analysis
  • Mechanics of constructing an LBO model

Contact us at 800-887-1320 or info@trainingthestreet.com for a free consultation to make sure the course is right for you.

Target Audience

  • Industry professionals that want to improve their finance skill-set to enhance their job responsibilities build job security and increase the possibility of promotion
  • Students who want to complement their course work with practical corporate valuation and financial modeling knowledge before starting as an analyst or associate
  • Prospective lateral hires looking to gain a competitive advantage in advancing their career or securing a job in the financial services industry (private equity, investment banking, hedge funds, research, asset management, etc.)

Flexible Makeup Schedule

Realizing that many of you have demanding schedules, Training The Street will accommodate you for any missed classes at no extra charge. Make-up classes will be delivered during the next evening or weekend course (based on your enrollment) and can be scheduled prior to the start of the course or during the course as needed.

Since 1999, Training The Street has specialized in Finance Training, Financial Training, Investment Banking Training and Financial Modeling Training around the world.