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International institute of management in technology

Current Topics in Finance

Next dates

Jun 11—12
2 days
Fribourg, Switzerland
CHF 1400 ≈USD 1372
CHF 700 per day

Categories

Investment

Description

This course covers relevant and current financial topics from a corporate perspective. A mix of case studies, class discussions and topical lectures will provide participants with a solid understanding of how companies deal on a managerial level with financial issues in a complex business environment.

What to expect

  • Financial Planning
  • Issuing Debt and Equity
  • Corporate Valuation (including Valuation of Tech Companies)
  • Capital Structure
  • Multinational Financial Management

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Detailed Description
Detailed Description
Euromoney Learning Solutions

Corporate Finance & Valuation

Next dates

Aug 5—7
3 days
New York, New York, United States
USD 3495
USD 1165 per day

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Description

Gain a complete understanding of Corporate Finance and Valuation at our 3 day overview

Corporate Finance is an important foundation for all financial decisions of a firm. A vast range of business decisions from credit analysis to merger and acquisition activity require knowledge of basic financial principles. These basic principles are taught in a course by a seasoned instructor who will use both theory and practical applications. While there are procedures and formulas, they need to be integrated with good business judgments. Included in the practical applications will be exercises and reference to a company cases. The eventual objective will be to explore methods of valuating a firm and enhancing it with various corporate finance strategies. Targeted Audience

Individuals in financial intern programs; those wishing to seek and enhance their positions in investment banking, private equity, venture capital, and valuation. Knowledge of the capital markets and financial accounting statements. A financial calculator is required. (Texas Instruments BA II Plus will be taught.) At times, Excel techniques will be demonstrated, but not taught.

Learning Objectives

Students will be able to:

  • Solve problems using various time value of money concepts
  • Identify statistical issues
  • Identify the relevant costs in a project
  • Calculate and compare advantages and weaknesses of capital budgeting techniques, especially the NPV and IRR of a project
  • Demonstrate how different qualitative factors impact on value
  • Calculate free cash flow forecasts and the challenges in determining their proper use
  • Calculate the terminal value of a business and determine its appropriate use
  • Calculate the enterprise and equity value of a business
  • Discuss Behavioral Issues
  • Discuss Relative Valuations Techniques among comparable companies
  • Explain why WACC is used to discount company free cash flows
  • Calculate WACC, cost of debt and cost of equity
  • Discuss other valuation methods including CAPM and Arbitrage Pricing Theory
  • Determine the optimal capital structure of a company and its dividend policy

Agenda

DAY ONE - Corporate Finance Fundamentals

Introduction and course overview

  • The importance and benefits of Corporate Finance
  • Examples of where and how Corporate Finance is used in capital markets
  • Linkage between investment and financing decisions
  • Agency issues and Ethics
  • Capital Market Risk/Reward concepts and Index Issues
  • Overview of topics to be covered

Basic Calculations

Time Value of Money

  • Present and Future Value Concepts and Calculations
  • Compounding (annual, periodic, continuous)
  • Annuities and Perpetuities
  • Complex Problems
  • Statistical issues

Exercises: Class participants will do Time Value Problems

Project Analysis / Capital Budgeting

  • Capital budgeting
  • Process of capital budgeting
  • Identifying cash flows
  • Incremental cash flows
  • Inflation i.e., constant vs. current dollar cash flows
  • Issues around identification of cash flows
  • Working Capital Considerations

Exercise: Identifying relevant costs

Payback and Discounted Payback

  • Drawbacks: time value of money; life after payback period
  • Internal Rate of Return (IRR)
  • Drawbacks: lending/borrowing; multiple rates of return; mutually exclusive projects
  • Net present value (NPV)
  • Making decisions with NPV
  • Profitability Index
  • Modified IRR, calculations and reasons
  • Separating the financing and investment decisions

Exercise: Using different methods to evaluate projects

DAY TWO - Company Financials and Discounted Cash Flow Valuation

Financials Section

Brief Review of Financial Statements

  • Locating Financial Information
  • Issues and hidden traps with accounting numbers
  • Accruals versus cash flows
  • Differential interpretation of GAAP and IFRS, non-Gaap and non-IFRS

Dividend Valuation Model

  • Dividend Discount Model and the key decisions on time periods
  • Perpetual and Gordon Growth Model
  • Estimating growth with various methods and their challenges

DCF Overview

  • Rationale for DCF valuation
  • Characteristics of a DCF
  • Analyzing the historic performance and looking at the operating environment with tools such as PESTEL, Porter, SWOT, Product life cycle

Exercise: Determining the operating environment of the case study

Forecasting Cash Flows

  • Cash Flows: Accounting and the challenging economic environment
  • Behavioral issues with forecasting cash flows
  • Calculating various free cash flows, Firm, Equity, EBITDA, NOPAT
  • Key areas to forecast and their sources
  • Determining the tradeoff on yearly cash flows and the Terminal Value
  • Real versus nominal returns

Exercise: Calculate the free cash flows for the company case study

Terminal Value

  • Asset Values
  • Using relative or comparable values (EV/EBITDA and EV/EBIT)
  • Perpetuities and growing perpetuities
  • Exotic measures for special industries

Exercise: Determine an appropriate terminal value for the company case study

Valuation Enterprise Value versus Equity Value

  • Calculate Enterprise and Equity Values
  • Enterprise back door and front door methods
  • EVA

Exercise: Calculate the company case study Enterprise and Equity values

DAY THREE - Cost of Capital and Capital Structure

Risk and Valuation Section

Relative Valuation Techniques

  • Peer group valuation challenges
  • Key ratios and their trade-offs, especially with the ratios of P/E, PEG, EV/EBITDA, MV/BV
  • Special ratios for unique industries

Exercise: Calculate the value of the company case study using peer group analysis

Basics of the cost of capital

  • Risk versus Return overview
  • Theoretical perspectives
  • Systematic and unsystematic risk
  • Beta concepts

Weighted Average Cost of Capital

  • WACC overview

Cost of Debt -

  • Yield-to-maturity and spreads over US Government bonds
  • Impact of taxes
  • Bank Debt
  • Straight bonds - fixed and floating rates
  • Concepts on Convertible Bonds
  • Leases

Exercise: Calculate the cost of debt for the company case study if there is debt, but also if the company has to incur debt

Cost of Equity

  • Preferred Shares
  • Common Shares
  • Dividend Discount Model
  • Leveraged Beta Considerations
  • Capital Asset Pricing Model
  • Arbitrage Pricing Theory

Exercise: Calculate the company case study cost of equity using different approaches

Weighted Average Cost of Capital

  • Time Varying
  • Factors that can affect WACC

Exercise: Calculate the company’s case study WACC

Optimal Capital Structure

  • In theory
  • In practice
  • Dividend policy

Exercise: What is the optimal capital structure for the company case study, and how can it be influenced by strategic growth objectives

Putting It All Together

Determining valuations with company cases

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