FNCE 3415 Valuation and Financial Modeling

Videos

I will post videos to this page throughout the semester. The videos will mostly be solutions to homework or in-class Excel exercises; the videos are not a replacement for my lectures. Videos should not be used in lieu of coming to class. Excel can be difficult to learn therefore I make these videos in case you get lost in class and need to revisit a topic. Please use them as an additional resource to help learn valuation and modeling. Disclaimer: Values may be different depending on when video was made and when you are watching.

Financial Statement Videos

Homework 1 Lemonade Stand Exercise

Basic Excel Videos

Formatting Homework 2 Functions

Financial Statement Analysis Videos

FSA: Calculate and Interpret

Financial Statement Modeling Videos

Gentex Unlevered Free Cash Flow FCFF More Practice Homework 5: Pro-forma Financial Statements Homework 5: In-class exercise

DCF Valuation Videos

Gentex Terminal Value and WACC Alaska Airlines Terminal Value and WACC Stryker Beta Estimation Homework 6 Homework 7 Gentex: Dealing with Equity Compensation Gentex: Sensitivity Analysis

Relative Valuation Videos

LTM Example Relative Valuation: Gentex


Football Field Chart

Football Field Chart

Advanced Excel Videos

Advanced Excel Homework 10

Video #3: Basic Excel Formatting

This video goes over basic formatting and introduces students to shortcut keys in Excel. Note this video is a summary of the material covered in WSP Excel Crash Course.

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Video #5: Functions

This video goes over the Class Worksheet from Basic Excel. It covers functions related to time value of money, statistical function, logical functions, lookup functions, and custom formatting.

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Video #6: FSA: Calculate and Interpret

This video goes over the Class Exercise from Financial Statement analysis. It covers calculating a common-size balance sheet and income statement for Edwards Lifesciences (EW). We also cover a range of ratio calculations. Lastly we briefly discuss interpreting the numbers.

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Video #7: Gentex Unlevered Free Cash Flow

This video goes over calculating the projected unlevered free cash flows for Gentex Corp. Topics include pulling in historical data dynamically, estimating sales growth and other important inputs using the 10K, analyst reports, and earnings call transcript, calculating NWC, and proper modeling formatting.

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Video #8: FCFF More Practice

This video is additional practice calculating unlevered cash flows for Alaska Air. The video focuses mainly on the calculation and alternative approaches to those used in the Gentex example.

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Video #11: Gentex TV and WACC

This video works through the Gentex template. We discuss how to calculate the Terminal value using perpetuity growth and the exit multiple approaches. We also work through the calculation of the weighted average of capital. Lastly we finish by calculating the enterprise value and the associated equity value of Gentex. Note: Do not use average debt for WACC calculation of capital structure weights; only done in video to show a non-zero debt value.

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Video #12: Alaska TV and WACC

This video works through the Alaska Airlines template. We discuss how to calculate the Terminal value using perpetuity growth and the exit multiple approaches. We also work through the calculation of the weighted average of capital. Lastly we finish by calculating the enterprise value and the associated equity value of Alaska Airlines.

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Video #13: Stryker Beta Estimation

This video works through the estimation of beta using both the regression and bottom up approach.

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Video #16: Gentex: Dealing with Equity Compensation

This video works through the a few different approaches to accounting for equity grants to employees in our valuations. Specifically how to deal with past option awards through either a treasury stock approach or directly valuing the options using Black Scholes.

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Video #17: Gentex: Sensitivity Analysis

This video works through a sensitivity analysis of our Gentex Valuation. Discussion includes the use of Data Tables and Scenario Manager in Excel. I also recap our valuation from start to finish. Note please use the Solution file from Video #16 as your starting point.

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Video #18: LTM Example

This video walks through a Last twelve month calculation for Microsoft, Best Buy, and Walt Disney as of November 2019.

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Video #19: Relative Valuation: Gentex

This video walks through a relative valuation using public trading comparables. Please note there is an (obvious) error around 31:30 mark, I copied over the value in Cell F24 (with F25), you should do the opposite and drag the F24 formula down to F25. The error is corrected in the attached solution. Also forgot to add 28 (Operating Lease, current) when calculating Net Debt for VC.

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Video #20: Football Field Chart

This video goes over the steps to building a football field chart.

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Video #21: Advanced Excel

This video covers miscellaneous Excel skills including Pivot Tables, conditional formatting, basic graphing skills, concatenating, INDIRECT function, the group of TEXT based functions, and goal seek.

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