London

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Who should attend the course?

  • New hires who have joined the firm late and missed the in-house program
  • Individuals looking to fill a knowledge gap
  • Experienced bankers looking to refresh their technical skills
  • Teams employed in financial strategy roles from non-banking corporations
  • Graduates preparing to interview for a role in the finance sector
  • Students at business school and looking for a career in finance

Course details

DCF Valuation

Delegates learn how to build a discounted cash flow valuation model. The session starts with an overview of the valuation methodology, and the steps required in setting up a valuation model. We then focus on the calculation of free cash flow. A detailed ratio analysis is used to establish the reasonableness of the forecasts and to identify when the target company reaches steady state.

 

We analyze the weighted average cost of capital, breaking it down into its components. We complete the valuation model by calculating terminal values, using both the exit multiple method and the perpetuity growth method. The free cash flows are discounted to arrive at enterprise values and the implied share price. Once the valuation is complete delegates perform several checks on the analysis using key ratios, and sensitivity and scenario analysis.

 

Learning outcomes

  • Calculating unlevered free cash flows
    • Drivers of cash flow
    • Ratio analysis
  • Weighted average cost of capital
    • Optimal capital structure using peer analysis
    • Establishing the company’s forward looking cost of debt
    • Cost of equity: understanding the risk free rate, the equity risk premium and beta
    • Unlevering and re-levering the beta
    • Calculating WACC for the case company
  • Calculating the terminal value
    • Perpetuity growth (Gordon Growth model) method
    • Exit multiple method
  • Building a discounting model
    • Mid-year adjustments
  • Calculating enterprise and equity values
  • Sanity checks 
    • Reinvestment rate and ROIC
    • Implied multiples and growth rates
    • Percentage of value in the terminal period
"It's great to have access to the AMT online platform. I found the videos and quizzes really useful to refer back to after my public course. The videos in particular were simple and easy to understand." ~ analyst, private equity firm

View video to get a flavour of the course

What will you receive on the course?

While this is a face to face training course, a blended learning approach is taken and delegates will be provided with access to AMT Online. Our study materials contain both the knowledge and practice materials required to assist with the learning process and help you in your job role. Course materials include:

 

  • printed course binder with copy of the slides
  • laminated summary sheets
  • 24/7 access to AMT Online (AMTO)
  • class recordings
  • course notes
  • quizzes
  • electronic homework/study files

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