Formation/Cours

At the end of the course, the student should be able to:
– Critically describe standard valuation techniques
– Use Thomson Reuters Eikon to extract data and analytics for valuing equity or a firm
– Estimate the cost of different sources of funding
– Estimate future free cash flows generated by the firm
– Examine how the structure of capital affects the value of the firm
– Describe the determinants of firm value and perform the sensitivity analysis of the model to different assumptions
– Build the spreadsheet valuation model in Microsoft Excel and dynamically link it to Thomson Reuters Eikon data
– Solve professional dilemmas using concepts of CSR and ethics
– Breakdown complex organizational problems using the appropriate methodology
– Construct expert knowledge from cutting-edge information
– Make effectual organizational decisions
– Demonstrate an expertise on key concepts, techniques and trends in their professional field
– Formulate strategically-appropriate solutions to complex and unfamiliar challenges in their professional field

1. Introductory thoughts on valuation, analysis of the asset, overview of the main valuation techniques (relative valuation, discounted cash flow method; firm value vs equity value)
2. Estimating the cost of capital: equity risk and cost of equity (detailed analysis and calculation of the CAPM components: risk-free rate; historical and implied equity risk premium; historical, fundamental and accounting beta).
3. Estimating the cost of capital: cost of debt and cost of preferred stock
4. FCFF and FCFE models, calculation of cash flows, building growth forecast
5. Advanced topics in valuation: adjustments, accounting for country risk in valuations in emerging markets
6. Concluding remarks (sensitivity analysis; scenario analysis; Monte-Carlo simulation