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Equity Research vs. Investment Banking: Careers, Compensation, Exits, and AI/Automation Risk

Mergers and Inquisitions

For example, in IB interviews, youll have to know about accounting, valuation/DCF analysis, merger models, and LBO models plus the usual fit/behavioral questions , your resume walkthrough , and a few recent deals. The other issue is that institutional investors dont necessarily need the current volume of research. No, probably not.

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Top DCF Modeling Courses for Aspiring Finance Professionals

OfficeHours

The discounted cash flow analysis, commonly referred to as the DCF, along with the Leverage Buyout Analysis, commonly referred to as the LBO, are some of the most commonly used and complex financial modeling techniques on the Street today. You can also check our various course curriculums for different careers (i.e.

DCF 147
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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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M&A Blog #15 – valuation (tools and data preparation)

Francine Way

Discounted Cash Flow (DCF) i s 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. Target’s current stock price: Can be obtained from sources such as Yahoo Finance. or as a premium percentage to current target’s stock price.

Valuation 130
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M&A Blog #20 – valuation (Dividend Discount Model - DDM)

Francine Way

Forecasting the future stock price at the end of the forecast horizon, as well as its present value. It is the forecasting of future stock price at the end of the forecast horizon along with its present value calculation. Deciding on a forecast horizon (holding period). Deriving the long-term dividend growth rate.

Valuation 130
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M&A Blog #21 – valuation (scenario / sensitivity analysis)

Francine Way

Thus far, we have discussed five valuation methods: DCF, Comparable Company, Precedent Transaction, LBO, and Dividend Discount Model (DDM). An example of this technique include the changes of stock value given differing: WACCs and long-term free cash flow growth rates. how likely is it that the stock price is that low?).

Valuation 130
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M&A Blog #18 – valuation (Precedent Transaction)

Francine Way

Data sources like Pitchbook would typically captured this information; or it can be calculated using the samples’ Consideration Per Share and sample targets’ stock prices at the time of the announcements - both pieces of data can be found in press releases of the sample transactions or in Pitchbook.

Valuation 130