Theory for Quiz 1

Description

Handy short summary covering every concept you need to know for the first quiz. Also, industry-specific characteristics listed to solve common-sized balance sheet questions. Contents Industry analysis 1 Porter’s 5 analysis 1 PESTEL acronym 4 Industry Life-cycle picture 4 Relative valuation 5 Introduction 5 How to find comparables / peers? 5 How to do relative valuation from scratch? 5 Multiples 6 P/E – equity value multiple 6 Enterprise Value / EBIT(DA) – firm value multiple 6 Other multiples 6 Trading v Transaction multiples 7 Recognising industries on common-sized financial statements 7 Adjustments to data 8