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OVERVIEW

This intensive online course is designed to explore corporate valuation tools and skills used by practitioners for situations such as initial public offerings, general investing, leveraged buyouts (LBO), and mergers and acquisitions. Real world examples are used to enhance the experience.
 
This is a six-part course focusing on Valuation Fundamentals, Trading Comparables Valuation, Transaction Comparables Valuation, Valuation Fundamentals, Discounted Cash Flow (DCF) Valuation, Leveraged Buyout (LBO) Analysis Fundamentals, and M&A Analysis Fundamentals.

14 hours of video content.
Estimated 28 hours to complete.

PREREQUISITES

This course is open to all. To maximize the benefit of this course we recommend an understanding of financial statements and Microsoft Excel.

Valuation Fundamentals:

Learn the basics of the three main techniques used to value businesses and shares - Relative Value, DCF and Levered or LBO Valuation. In doing so you will also learn the distinction between equity value and enterprise value, and when each is appropriate to analyse.

LEARNING OBJECTIVES

  • Calculate Equity Value and EV for a company given share price and balance sheet information
  • Calculate EBIT, EBITDA and P/E multiples
  • Perform a basic DCF valuation of a business
  • Perform a basic LBO analysis and valuation of a business
  • Understand the relative strengths and weaknesses of these techniques, and when one might be more appropriate than another

TOPICS COVERED

Complete topics step by step or jump to any of the below at any time.

  • Roadmap
  • Valuation Outputs
  • Enterprise value and equity value
  • The EV to equity value bridge
  • Comparables valuation
  • EV Multiples - EBIT, EBITDA, Sales
  • Equity Multiples - P/E ratio
  • DCF valuation - Free cash flow, WACC, Terminal Value, Derivation of EV and share price
  • LBO valuation - LBO basics, Calculating IRR, Calculating LBO value of a business

Transaction Comparables Valuation:

In order to value a business that might be bought or sold, we learn how to look at historical acquisitions of similar businesses, to estimate a fair transaction or takeover value of a business. This session is complementary to Trading Comparables Valuation, but rather than listed peers, looks at recent historical deals where control was achieved by the buyer, to give a sense or fair value in a transaction context. This technique is used in M&A advisory and PE to estimate the value of an entire business and the synergies that might be achieved by a buyer, rather than a small parcel of shares.

LEARNING OBJECTIVES

  • Identify an appropriate group of publicly traded, or ‘listed’ peers
  • Compute their fully diluted equity values and Enterprise Values (EV)
  • Measure each peer’s earnings over a variety of time frames including Last Twelve Months (LTM) and calendarized forecast year
  • Make ‘pro-forma’ adjustments to earnings numbers to remove distortions from acquisitions or disposals made by the comparable firms
  • Interpret your multiples and formulate a valuation of the businesses in question

TOPICS COVERED

Complete topics step by step or jump to any of the below at any time.

  • Identify and select comparables historical transactions
  • Accurately measure the historical recurring earnings of the companies acquired in these deals and compare this to the effective Enterprise Value paid by the acquirer for the entire business
  • Interpret the results and apply your analysis to the target business

Trading Comparables Valuation:

Learn in detail how to perform an accurate and meaningful trading comparables valuation of a target business relative to its publicly traded or ‘listed’ peers. This technique can be used on a wide variety of business and is used by equity research and institutional investors as well as parties valuing entire businesses such as corporate or ‘strategic’ buyers/ sellers, Private Equity (PE) funds and financial sponsors and advisory firms.

 

LEARNING OBJECTIVES

  • Identify an appropriate group of publicly traded, or ‘listed’ peers
  • Compute their fully diluted equity values and Enterprise Values (EV)
  • Measure each peer’s earnings over a variety of time frames including Last Twelve Months (LTM) and calendarized forecast year
  • Make ‘pro-forma’ adjustments to earnings numbers to remove distortions from acquisitions or disposals made by the comparable firms
  • Interpret your multiples and formulate a valuation of the businesses in question

TOPICS COVERED

Complete topics step by step or jump to any of the below at any time.

  • Selecting comps
  • Calculating value
    • Diluted equity value
    • Net debt
  • Calculating the value drivers – scrubbing the numbers
  • Historical adjustments
  • Interpreting the output
DCF Valuation:

Learn to follow best practices in generating a forecast model and DCF valuation of a business using ‘fundamental valuation’ techniques. DCF can be used on a wide variety of business and is used by equity research and institutional investors as well as parties valuing entire businesses such as corporate or ‘strategic’ buyers/ sellers, PE funds and financial sponsors and advisory firms.

LEARNING OBJECTIVES

  • Forecast free cash flow to the enterprise
  • Estimate an appropriate Weighted Average Cost of Capital (WACC) for the business you are valuing
  • De-lever comparable companies betas and re-lever to the target capital structure of the business being valued
  • Estimate a reasonable Terminal Value (TV) using either a multiple, or a perpetual growth assumption
  • Discount free cash flows and TV to valuation date, incorporating the mid-year adjustment
  • Translate the resulting EV to an equity value
  • Sensitize you results in an Excel data-table

TOPICS COVERED

Complete topics step by step or jump to any of the below at any time.

  • Deriving share price
  • Free cash flows
  • Weighted average cost of capital
    • Cost of debt
    • Cost of Equity
    • De-levering and re-levering WACC
  • Terminal value
  • Discounting & the mid-year convention
  • EV to implied shared price
  • Checking the analysis
LBO Analysis Fundamentals:

Learn how financial sponsors select appropriate target businesses, the typical funding structures they use to acquire these target businesses and the way they generate a return, or IRR for their investors through a sale or ‘exit’ at the end of the LBO.

LEARNING OBJECTIVES

  • Define an LBO transaction
  • Understand the funding structure of an LBO
  • Identify the process of the subordination of debt within an LBO funding structure
  • Build an LBO model in Excel for any cash-generating business

TOPICS COVERED

Complete topics step by step or jump to any of the below at any time.

  • LBO valuation
  • Financing structure
  • Senior secured debt
  • Senior unsecured debt
  • Subordinated debt
  • Equity financing
  • Debt push down
  • IRR
M&A Analysis Fundamentals:

This course covers the basic steps of analyzing an acquisition - covering the impact of a deal on the financial statements with a particular focus on EPS, PE and contribution analysis. By the end of the course, you will build an accretion / dilution model using EPS forecasts and acquisition assumptions, proforma leverage ratios and a proforma balance sheet.

LEARNING OBJECTIVES

  • Build a detailed Sources & Uses table, including impact of dilutive instruments in the target, operating cash requirement, and equity issuance, debt issuance and advisory fees
  • How to consolidate the two balance sheets at deal dates, including the impact of fees, asset step-ups and related deferred tax liabilities, and related Goodwill adjustments
  • How to build a fully integrated three-statement model including funding, synergy and tax implications
  • How to generate a variety of outputs to analyse the deal including: EPS accretion / dilution, ROIC, premium vs. synergy analysis, analysis at various prices (AVP), and contribution analysis

TOPICS COVERED

Complete topics step by step or jump to any of the below at any time.

  • Big picture: what is the transaction impact on acquirer and target shareholders?
  • Preparing key acquisition data
  • Building a flexible funding structure
  • Modeling acquisition adjustments
  • Calculating the accretion / dilution effects of the deal
  • Calculating and understanding contribution analysis
  • Ownership issues
  • Income statement contribution
  • Credit issues and leverage ratios
  • The strategic implication of different financing alternatives
  • Synergies and synergies needed to break even
  • Proforma balance sheet
  • Sensitivity and scenario analysis

**Training The Street acquired AMT Training in 2021. We have merged AMT's products into one store, to increase our content offering.**

Save money with this course by purchasing our bundle!

This course is available in the:
Essentials 10 Courses Bundle - Valuation, Modeling and Origination.

Save up to 57% on all courses with this bundle!
The bundle includes the following courses:

  • Financial Statement Analysis
  • Excel Best Practices for PC: Become an Excel Expert
  • Financial Modeling: Building a Complete Model in Excel
  • Corporate Valuation: How to Value Companies and Mergers
  • Merger Modeling: How to build an M&A Model in Excel
  • LBO Modeling: Building an LBO Model in Excel
  • Capital Markets and Corporate Funding
  • Debt Captial Markets
  • Equity Capital Markets
  • Applied Excel: Working with Data Sets and Scenario Analysis

Group Orders

We offer discounts for group orders on our self-study products. Group orders are an attractive option for companies or teams looking to upskill together.

Contact us at selfstudy@trainingthestreet.com to learn more about how to save money on group orders.

Browse Our Course Bundles Below:

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Gain your recognition with our digital certificates

Training The Street has been teaching the biggest finance firms for over 20 years. To help unlock your career potential, we offer certificates to provide the recognition you deserve.

After you finish your course, you will receive a certificate which can be easily added to your LinkedIn profile.