USF - Corporate Valuation Methodologies

Course Goals & Overview:
Learn how corporations are valued and the major analytical tools that are used. Go beyond academic theory to real-world methods as used by professionals; includes a crucial primer to Corporate Finance and its non-theoretical application. Apply learning objectives and goals immediately by analyzing a $6 billion+ transaction. Topics covered include: (i) how to value a company (trading comps, deal comps, DCF, LBO, break-up and asset valuation); (ii) importance of Enterprise Value, EBITDA, capital structure, leverage and WACC; (iii) analyze valuation multiples and ratios; why are PE ratios sub-optimal as a valuation metric?; (iv) practical, non-theoretical application of introduction to corporate finance

Course Sections:
Valuation Methodologies
- How much is a company worth? Why is the current stock price not an accurate indication of value?
- How do you tell if a company is under-valued or over-valued?
- Why would one company command a higher or lower premium than its direct competitor?
- What is the importance between enterprise value and equity value?
- Why do we include minority interest and exclude capital leases?
- What is the relevance of capital structure and leverage on a company's value?
- Why and how is corporate finance so critical to managing a firm's profitability?
- What exactly does a multiple tell us? Learn the correct way to use P/E ratios and other multiples
- Why are P/E ratios misunderstood and what other profitability-related ratios are more important?
- What is EBITDA and why is it so important?
- Utilizing the correct numerator for multiples analysis
- Calculating implied value based on multiples analysis
- What is a leveraged buyout and what are the main motives for LBOs?

Case Study Discussion
- Analysis of "football field" and reference ranges
- Detailed discussion of the major valuation methodologies, their nuances and application in the real-world
- Analyzing, comparing and contrasting trading comps, deal comps and premiums paid
- Detailed explanation of Discounted Cash Flow (DCF) valuation, its theory and application
- Discussion of why the DCF is arguable one of the most important analyses while simultaneously one of the most academic and least practical of them all
- Review of WACC (weighted average cost of capital), CAPM (Capital Asset Pricing Model)
- How do you approach valuing a company with completely disparate businesses?


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