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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.

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Multi-Manager Hedge Funds: A Meritocratic Paradise or a Revolving Door of Burnout?

Mergers and Inquisitions

Almost all conversations about buy-side roles eventually turn to multi-manager hedge funds , also known as “pod shops.” There are only a few dozen large funds in this category worldwide, but they’ve greatly impacted the markets and finance careers. These funds are usually multi-strategy as well.

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Growth Equity: The Child Prodigy of Private Equity and Venture Capital, or an Artifact of Easy Money?

Mergers and Inquisitions

Some argue that GE offers the best of both worlds: the opportunity to fund innovation and growth – as in venture capital – plus the ability to limit downside risk and invest in proven companies – as in private equity. Many of these firms use debt to fund deals, and they complete bolt-on acquisitions for portfolio companies.

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

Francine Way

If these instruments can’t fully cover the Total Uses $ amount, the difference is the amount that the financial sponsor (the PE firm) will have to finance out-of-pocket from their fund. Capex as % of Sales = - Capital Expenditures / Revenue. Proceeds at Sale = Equity to Sponsor calculated earlier.

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Wealth Management vs. Investment Banking: Career Deathmatch

Mergers and Inquisitions

The Nature of the Work: Markets, Analysis, Sales, and Interpersonal Skills Wealth management (WM) requires broader knowledge of the financial markets since you may have to advise clients on everything from their portfolio allocations to upcoming tax changes. If you have good sales skills, you could break in with a middling GPA (3.0 – 3.5)

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The Dividend Discount Model (DDM): The Black Sheep of Valuation?

Mergers and Inquisitions

It can be useful for certain companies, such as power and utility firms and midstream (pipeline) operators in oil & gas … …but it’s also much harder to set up and use than a standard DCF. The basic set of steps looks like this: Step 1: Forecast Revenue and Expenses This is the same as in any other 3-statement model or DCF.

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Keeping Up with Delaware Appraisal Jurisprudence Since Aruba: Deal Price Reigns Supreme, But Will Recent Decision Lead to More Arbitrage?

Cooley M&A

In the Delaware appraisal decisions that have followed, the court has consistently found deal price (minus synergies) to be the most reliable indicator of fair value, so long as there was a sufficiently robust sales process that bore “objective indicia” of reliability. Pre-Payment of Appraisal Award Non-Refundable. Conclusion.