DCF Valuation Modeling
Three Key factors on version drivers? - ANS-1. The maximum vital model drivers are sales
quantity and income charge.
2. You begin by finding the minimum and maximum degrees of the model drivers.
Three. Only model drivers want to be examined
A DCF is an instance of a _______ valuation
A. Relative
B. Cost
C. Absolute Valuation
D. Intrinsic Valuation
E. Market Valuation - ANS-C & D: Absolute and Intrinsic Valuation
Advantages and Disadvantages of Comparable Trading Analysis - ANS-Advantages:
Readily to be had and observable facts
Efficient Pricing
Disadvantages:
No peer agencies are exactly similar to the target corporation.
Advantages and Disadvantages of Discounted Cashflow Analysis - ANS-Advantages:
One of the soundest valuation strategies
Provides an opportunity to find out about the commercial enterprise
Disadvantages:
Requires a-lot of inputs and the version is only as proper as the inputs used
Advantages and Disadvantages of Precedent Transaction Analysis - ANS-Advantages:
Readily to be had and observable records
Shows market on the market or buy of business enterprise
Disadvantages:
Hard to discover flawlessly similar and current transactions
Before you make data tables you have to take a look at excel for what? -
ANS-File->Options->Formulas
Under workbook calculations make certain its set to "Automatic" not "Manuel" or "Except for
records tables."
Debt to capital system - ANS-Debt/(Debt+Equity)
Define Comparable Trading Analysis - ANS-Looks on the valuation for similar peer agencies
that are publicly traded
(Relative Valuation Technique)
(Shows Market view on valuation)
, Define going situation - ANS-The business is going to operate indefinitely into the destiny.
Define Precedent Transaction Analysis - ANS-Looks at the purchase expenses for comparable
peer corporations in current transactions.
(Relative Valuation Technique)
(Shows Acquirers "Buyers" view on valuation)
Define Unlevered Free Cashflow - ANS-Cash glide available to all capital providers
Define Weighted Average Cost of Capital - ANS-The value of capital from all capital companies
Discounted Cashflow Analysis - ANS-Builds a model of a corporation to get the present fee of
all future loose cash flows
(Absolute Valuation Technique)
(Shows Your View on valuation)
EBITDA Method Formula - ANS-EBITDA
-Current Taxes
-Capital Expenditure
-Change in NWC
=Unleveraged Free Cashflow
*More Common in Capital Market Groups
Shorter to apply
Shows EBITDA (A profitability Measure)
Enterprize Value formula - ANS-ULFCF/WACC=Enterprise Value
*Both numerator and denominator represent all capital vendors
Equity Value system - ANS-Equity Value = Enterprise Value - Net Debt
Equity Value formula First Method - ANS-(ULFCF/WACC) - Net Debt = Equity Value
Equity Value formulation Second Method - ANS-LFCF/WACC =Equity Value
Not as commonplace method
Levereged Free Cashflow
Only from fairness Providers
For a sensitivity evaluation what is the excel shortcut - ANS-Alt A W T
For row enter you positioned terminal price growth rate
For Column enter mobile you placed WACC
How will we examine the significance of the model inputs? - ANS-We isolate the drivers, by way
of their importance on the model. They must have the most important effect on the volitility and
deliver a vast effect on the outputs.
How do you forecast tax in a DCF for the terminal value Column (Also Called Term in version) -
ANS-You set deferred tax to zero since the authorities does no longer permit companies to defer
taxes into the future indefinitely.
For Current tax you get EBT*Tax price
Three Key factors on version drivers? - ANS-1. The maximum vital model drivers are sales
quantity and income charge.
2. You begin by finding the minimum and maximum degrees of the model drivers.
Three. Only model drivers want to be examined
A DCF is an instance of a _______ valuation
A. Relative
B. Cost
C. Absolute Valuation
D. Intrinsic Valuation
E. Market Valuation - ANS-C & D: Absolute and Intrinsic Valuation
Advantages and Disadvantages of Comparable Trading Analysis - ANS-Advantages:
Readily to be had and observable facts
Efficient Pricing
Disadvantages:
No peer agencies are exactly similar to the target corporation.
Advantages and Disadvantages of Discounted Cashflow Analysis - ANS-Advantages:
One of the soundest valuation strategies
Provides an opportunity to find out about the commercial enterprise
Disadvantages:
Requires a-lot of inputs and the version is only as proper as the inputs used
Advantages and Disadvantages of Precedent Transaction Analysis - ANS-Advantages:
Readily to be had and observable records
Shows market on the market or buy of business enterprise
Disadvantages:
Hard to discover flawlessly similar and current transactions
Before you make data tables you have to take a look at excel for what? -
ANS-File->Options->Formulas
Under workbook calculations make certain its set to "Automatic" not "Manuel" or "Except for
records tables."
Debt to capital system - ANS-Debt/(Debt+Equity)
Define Comparable Trading Analysis - ANS-Looks on the valuation for similar peer agencies
that are publicly traded
(Relative Valuation Technique)
(Shows Market view on valuation)
, Define going situation - ANS-The business is going to operate indefinitely into the destiny.
Define Precedent Transaction Analysis - ANS-Looks at the purchase expenses for comparable
peer corporations in current transactions.
(Relative Valuation Technique)
(Shows Acquirers "Buyers" view on valuation)
Define Unlevered Free Cashflow - ANS-Cash glide available to all capital providers
Define Weighted Average Cost of Capital - ANS-The value of capital from all capital companies
Discounted Cashflow Analysis - ANS-Builds a model of a corporation to get the present fee of
all future loose cash flows
(Absolute Valuation Technique)
(Shows Your View on valuation)
EBITDA Method Formula - ANS-EBITDA
-Current Taxes
-Capital Expenditure
-Change in NWC
=Unleveraged Free Cashflow
*More Common in Capital Market Groups
Shorter to apply
Shows EBITDA (A profitability Measure)
Enterprize Value formula - ANS-ULFCF/WACC=Enterprise Value
*Both numerator and denominator represent all capital vendors
Equity Value system - ANS-Equity Value = Enterprise Value - Net Debt
Equity Value formula First Method - ANS-(ULFCF/WACC) - Net Debt = Equity Value
Equity Value formulation Second Method - ANS-LFCF/WACC =Equity Value
Not as commonplace method
Levereged Free Cashflow
Only from fairness Providers
For a sensitivity evaluation what is the excel shortcut - ANS-Alt A W T
For row enter you positioned terminal price growth rate
For Column enter mobile you placed WACC
How will we examine the significance of the model inputs? - ANS-We isolate the drivers, by way
of their importance on the model. They must have the most important effect on the volitility and
deliver a vast effect on the outputs.
How do you forecast tax in a DCF for the terminal value Column (Also Called Term in version) -
ANS-You set deferred tax to zero since the authorities does no longer permit companies to defer
taxes into the future indefinitely.
For Current tax you get EBT*Tax price
