Re: GAAP or cash
if your projections need to be solid, why are you using analyst projections?
LBO analyses are primarily dependent on sensitivity analysis and case scenarios, particularly worse case scenarios and building data tables to see debt paydown and IRRs under stressful revenue and cash flow assumptions.

Shareholder momentum analysis
Not sure if this is the appropriate topic to post this question. I've been asked to put together a S/H momentum analysis going back 3 years for a public company. Some questions on this: 1) Do you start with, say top 25 holders today, and work backwards to trace how they reached this point? In order... Not sure if this is the appropriate topic to post this question. I've been asked to put together a S/H momentum analysis going back 3 years for a public company. Some questions on this:

1) Do you start with, say top 25 holders today, and work backwards to trace how they reached this point? In order to see their cost basis?
2) Which SEC forms should I refer to? Schedule 13D/G's and Form 4's?
3) Is is possible to see at each quarter how much each holder bought or sold?

Thanks Read More

Re: Package 3 - Advanced Financial Modeling - DCF analysis quest
You are correct.
It should say Jan 31, 2006.
Basically, normally our models say "as of Dec 31, Year 0", hence the -1.
We messed up (don't do this on the job!) and forgot to properly update it.
To fix this, please delete the -1 in the formula in cell A42.

Re: adv lbo model questions
Sources & Uses: - from the Merger courses, the legal structure can be stock or asset (most likely stock for an LBO, but not necessarily) - regardless of stock vs asset deal, debt refi'ed, etc is same treatment: you are buying the entire company - equity premium: based on appropriate valuation of... Sources & Uses:
- from the Merger courses, the legal structure can be stock or asset (most likely stock for an LBO, but not necessarily)
- regardless of stock vs asset deal, debt refi'ed, etc is same treatment: you are buying the entire company
- equity premium: based on appropriate valuation of the company
- excess cash: really means lower net debt (covered in our LBO Overview class) will make the equity injection less and thus, more attractive, correct
- various fees: again, please refer to LBO Overview course where there are several slides on various fees

Sources:
- cash: correct. usually a bridge loan is required since you don't have access to the cash

Valuation:
- TEV multiples: yes, after you do your valuation (and know how much to pay); also, this is quite often sensitized

P&L:
- D&A: doesn't usually include amortization of debt financing fees as the fees are capital structure related and technically go into Interest Expense; thus, it's not considered when calculating EBITDA
- Pro Forma: interest set to Year 1 primarily for smoothened leverage ratios (Interest coverage in particular); since the entire cap structure is altered, the last historical year of interest is irrelevant

PPA:
- correct to all of the above. Goodwill is still important - in this case, we assumed that the goodwill is re-allocated at the current cost basis, which is the implicit assumption when you don't do the full PPA as discussed in Merger courses

CF:
- debt financing fees: correct, non-cash expense in projection years as it was paid in cash during the deal; this is capitalized and amortized; hence the BS item change

Ratios:
- Cum. Debt Paydown: this is covered in the videos: just take Year 0 Pro Forma debt balance (fully anchored) and subtract the new Total Debt balance
- % Paid: take the Cum. Debt Paydown and divided by the Year 0 Pro Forma debt balance (fully anchored) and you'll have it
- your method is too complicated follow the videos! we show you the fastest and most efficient way to calculate! Read More

Re: Enterprise Value Formula
ah so technically cash in the EV formula is really excess cash. Assuming I can calculate with precision, excess cash should be the number I use correct?