article thumbnail

M&A Blog #17 – valuation (Comparable Company)

Francine Way

Building the proforma income statement, proforma balance sheet, and Free Cash Flow to Firm (FCFF). Calculating cost of debt, cost of equity, and weighted average cost of capital (WACC). Enterprise Value = Market Capitalization + Total Debt - Total Cash. Tangible Book Value = Book Value of Equity - Goodwill.

Valuation 130
article thumbnail

M&A Blog #16 – valuation (Discounted Cash Flow)

Francine Way

As I mentioned in my last post, Discounted Cash Flow (DCF) is a valuation method that uses free cash flow projections, a discount rate, and a growth rate to find the present value estimate of a potential investment. The major steps of DCF are: Identify extraordinary, unusual, non-recurring items from the target’s 10-Ks and 10-Qs.

Insiders

Sign Up for our Newsletter

This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.

article thumbnail

M&A Blog #19 – valuation (Leveraged Buy Out - LBO)

Francine Way

The major steps of LBO are: Building the Sources and Uses tables. Building a proforma balance sheet. Building a historical 3-statement model and a debt-interest schedule. Building the go-forward 3-statement model. Building the go-forward debt-interest schedule. Modeling the future exit.

Valuation 130
article thumbnail

Wealth Management vs. Investment Banking: Career Deathmatch

Mergers and Inquisitions

By contrast, investment banking is more about advising companies on transactions such as M&A deals , equity and debt deals , and restructuring. You will very rarely get exposed to the type of financial modeling that bankers complete: 3-statement models , DCF models , M&A models , LBO models , and so on.

article thumbnail

Mastering M&A Valuations: The Comprehensive Guide to Utilizing the Enterprise Value Calculator

Devensoft

As opposed to merely focusing on the market capitalization, which only accounts for the company’s equity value, the Enterprise Value Calculator considers the company’s debt, cash, and other financial liabilities. Discount Rates Discount rates are used in the DCF method to determine the present value of future cash flows.

article thumbnail

Metals & Mining Investment Banking: The Full Guide to Ground Zero for the Energy Transition

Mergers and Inquisitions

Metals & Mining Investment Banking Definition: In metals & mining investment banking, professionals advise companies that find, produce, and distribute base metals, bulk commodities, and precious metals on debt and equity issuances and mergers and acquisitions. What Do You Do as an Analyst or Associate in the Group?

article thumbnail

Buy Side M&A Blog Series - Vol 7 - Valuing The Target

RKJ Partners

Below are the six recognized methodologies with short explanations of each: Discounted Cash Flow (DCF) Analysis: This analysis derives an ‘intrinsic’ value of a company. Book Value of Assets: This approach is particularly useful for companies such as manufacturers and warehouses, where the business is heavily dependent on its assets.

M&A 40