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London Stock Exchange
This two-day workshop is designed to give participants a comprehensive introduction to valuation techniques
This two-day workshop is designed to give participants a comprehensive introduction to valuation techniques for use in various circumstances. These techniques can be used to value companies for acquisition or disposal purposes, or value other asset acquisitions such as real estate. The techniques are also useful for pricing financial instruments and assist in assessing the financial feasibility of projects.
Who should attend?
This workshop is designed for all finance and non-finance professionals seeking to understand the techniques required to assess the value of investments and companies, as well as advise clients regarding the desirability of projects and investments. No prior knowledge of valuation is necessary, but some finance and accounting knowledge would be an advantage.
By the end of the course, the participants will be able to:
- Understand the difference between equity value and enterprise value
- Value a company using the trading comparables technique and multiples
- Value investments using the transaction comparables technique
- Calculate the weighted average cost of capital (WACC) of a company
- Calculate each of the components of the WACC
- Value a company using discounted cash flow techniques
- Make investments decisions based on various approaches
The use of computers with Microsoft Excel installed (or similar software) is strongly advised to simplify the calculation process and allow participants to focus on the techniques being discussed.
Day 1: Introduction and relative valuation techniques
Session 1: Introduction to valuation
- What is valuation?
- The different approaches to valuation
- Enterprise value vs Equity value – the valuation bridge
Activity: The participants will be required to derive the Enterprise Value and Equity Value (and share price) for a couple of companies using the valuation bridge adjustment.
Session 2: Relative valuation techniques
- Trading comparables
Activity: The participants will be required to update a simple trading comparables model using selected companies and use the output to calculate a proposed share price range for the target company.
- Transaction comparables
Activity: The participants will be required to derive a valuation for some real estate properties based on the precedent transactions approach.
Session 3 – part 1: Fundamental valuation techniques
- The time value of money
- Discounted Cash Flow techniques (DCF)
Activity: The participants will be required to calculate the price of financial instruments using DCF techniques.
Day 2: Fundamental valuation techniques
Session 3 – part 2: Fundamental valuation techniques
- Making investment decisions
- Payback period
- NPV and IRR
Activity: The participants will be required to advise management about whether to invest in a project using DCF techniques.
Session 4: Valuation of Companies
- Using DCF techniques for valuing companies
- Forecasting Free Cash Flows
- Weighted Average Cost of Capital (WACC)
- Terminal value
Activity: The participants will be required to create a model to value a target company using DCF techniques and imply the share price.
Session 5: Leveraged Valuation
- Structuring a leverage valuation model
- Deriving the cash flows and debt balances
- Using IRR to assess the return on investment
Activity: The participants will be required to complete a LBO model and calculate the IRR to each investor.
"Really clear, knowledgeable, friendly – great!"
"It was very useful and covered many theoretical valuation techniques. Great tutor."
"Absolutely outstanding. The trainer’s mix of theory and case studies proved to be a very effective way of teaching and, although I had high expectations, I can honestly say that the trainer exceeded them. I would now feel very comfortable approaching the valuation of my business."