This Company Analysis and Valuation course will introduce basic approaches to analysing a business from a financial perspective using a range of key performance indicators, such as, profitability, return on capital, leverage, working capital management, asset utilisation and cash flow generation. The learning will be supported by examples using a real company. Areas of focus include understanding revenue concepts and drivers, costs of sales versus support costs and operating versus financing costs and ways to control these, including hedging. All this will be analysed in the context of the competitive pressures on a business and management’s business strategy in response to these pressures.
The second half of the day is spent linking the analysis to company valuation and explaining the key drivers of the value of a business. As is the case with business analysis there are various reasons why a company might have to be valued, including for merger and acquisition (M&A) transactions or to assess if a share is trading at a fair price on the stock exchange. As a consequence, multiple valuation techniques have evolved and the course will introduce the key valuation concepts including enterprise value versus equity value, trading and transaction multiples and discounted cash flow valuation. This will include the time value of money concept, valuing a controlling or a minority stake in a business and highlighting the key challenges of valuing a company. Again, the analysis will be supported by using a real company.