2 Part Course  | 
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Valuation Fundamentals

2 Part Course  |  Learn the fundamentals of the main equity valuation techniques with this thorough and practical introductory course

A majestic view of the famous Millennium Bridge in London with people walking across it

A one-day course presented over two-half days in a virtual class from 9:30am to 1:00pm UK time

Part One

The session lays the foundations to build a solid understanding of business and equity valuation techniques, in the context of mergers, acquisitions and capital markets. The most common valuation methodologies are introduced, together with the underlying theory. The concepts of enterprise value and equity value are explained, using simple but rigorous exercises. Finally, the basics of implied valuation multiple and discounted cash flow valuation are introduced. Case studies are used throughout the session based on real European companies.  

1.Valuation fundamentals

  • The importance of valuation in corporate finance
  • Valuation theory and framework: Three fundamental approaches
    • Assets
    • Earnings
    • Market
  • The basis for calculating the present value of future money
  • Application: Overview of the major valuation techniques
    • Discounted cash flow analysis
    • Trading comparables valuation analysis
    • Transaction comparables analysis
    • Net assets and other ‘industry’ metrics
  • Derivation of enterprise values using a fundamental valuation approach
  • Early-stage businesses: valuation in the absence of profits
  • Enterprise vs. equity value
    • Understanding the difference
    • The components of the ‘bridge’ between the two
  • Case Study I: Equity bridge – exercise and worked example

2.Discounted Cash Flows

  • Presenting unlevered free cash flows as a basis for business valuation
    • Components and drivers of cash flow
  • Discounting future cash flows: methodology
    • Building a discounting model
    • Mid-year adjustments
    • Calculating the terminal value
      • Perpetuity growth method
    • Exit multiple methods
  • Calculating the weighted average cost of capital
    • Establishing the company’s cost of debt
    • Cost of equity: understanding the risk-free rate, the equity risk premium and beta
    • Optimal capital structure using peer analysis
    • Unlevering and relevering the beta
    • Calculating WACC – case study
  • Applying the calculated WACC to our discounting model
  • Calculating enterprise and equity values
  • Sanity checks
    • Implied multiples and growth rates
    • Percentage of value in the terminal period
  • Case Study II: We will introduce a diverse, multinational company valuation in the oilfield services industry, with emphasis on the calculation of WACC
  • Case Study III: Perform a DCF on a broadcast satellite business, taking presented cash flows and understanding the sensitivity of the valuation to key inputs – WACC and terminal value

Part Two

3. Comparable M&A Transactions (‘CoTrans’)

  • Difference between the equity valuation techniques based on trading (market) multiples and precedent M&A transaction multiples
  • Selection of transactions and information gathering
  • Issues with sourcing data: which period’s EBITDA?
    • Example to illustrate the importance of insight
  • Control premium and synergies
  • Practical issues with transaction comparables
  • Analysis and summary output
  • Case Study IV: Valuation of a control transaction in the Building Materials sector

4. Comparable Market Traded Companies (‘CoCos’)

  • Screening companies to identify a suitable comparable set
  • Review publicly available data (including from databases) on the comparables
  • Issues in assessing the data:
    • Cleaning non-recurring items from earnings and resulting tax adjustment
    • Calendarization issues
    • Last-Twelve Months (LTM) analysis
    • Outliers
    • The pros and cons of forward-looking and historical multiples, based on
      • Revenue
      • EBITDA
      • EBIT
      • P / E
    • Determining an appropriate range
    • Calculating the valuation of a company
      • Enterprise value
      • Net debt calculations, other possible adjustments e.g. minority interests, JVs, equity method investments
      • Fully diluted: number of shares and value of share options
      • Equity value per share
    • Troubleshooting and checking the output
    • Applying the results
    • Case Study V: Fair valuation of a soft drinks business. We will identify a broad peer group and the most appropriate comparables. From the range of multiples observed, which will also include transaction comparables, we then perform an enterprise valuation analysis based on EV/Sales, EV/EBITDA and other key multiples.

5. Sum of the parts

  • Understanding a situation where all methods are
  • Where a business has several divisions 
  • Sector-specific multiples
  • Case Study VI: ‘Sum of the parts’ valuation of an oilfield services group

6. Conclusion

  • Review of all material, key messages and key learnings
  • Revisit case studies as necessary
  • Opportunity for discussion

The trainer has worked on corporate finance and capital markets transactions for over thirty years, holding positions on the client side as well as leading advisory teams.

At the Department of Energy, he was a civil servant involved in the privatisation of British Gas, a global IPO involving a large advisory team. He also spent two years (1990-92) in the Hungarian Government privatisation agency working with many advisory firms, as the changing political environment triggered massive ownership change. He has worked in major investment banks (Swiss Bank Corporation International – now UBS - and Lazard) and also co-founded a successful M&A advisory boutique firm. In 2021 he retired from KPMG, where he spent 13 years in the firm’s global M&A business, based in Scotland.

His experience combines a broad range of M&A and equity transactions in North and Central America, Asia Pacific, and all the major European countries, plus, most recently, in Africa. His courses draw deeply on case studies from transactions he has run, bringing practical examples to set alongside the theory.

  • Participants are introduced to the main equity valuation techniques.
  • The participants start with an overview of fundamentals, where the intellectual framework and the different methodologies are discussed.
  • The differences between Enterprise Value (EV) and equity value are explained in detail.
  • The participants will then look at the Discounted Cash Flow technique (DCF) and specifically at computing the Free Cash Flows and the Weighted Average Cost of Capital (WACC), to understand how valuation by DCF is undertaken.
  • Lastly, participants will review valuation based on comparable quoted company and comparable M&A transaction multiples, compute several EV and equity multiples and be introduced to why the market applies different multiples to apparently similar companies.
  • Exercises, case studies and work examples throughout.

  • If you are looking for a course that’s led by an experienced trainer, you’ve come to the right place. Our trainer is a corporate financier with over 30 years of experience in capital markets and corporate finance valuation advisory work.
  • Our trainer’s experience includes the application of all main equity valuation techniques to businesses at all stages of development and in all forms of transaction: growth capital, IPO (Initial Public Offering), M&A and distressed sales.
  • Comprehensive material covering all the fundamentals, from basic through intermediate level.
  • Step-by-step Excel models illustrating key concepts.
  • Delegates are encouraged to bring their own examples of difficult equity valuation challenges to discuss and debate during the session.
  • The analysis is key – but valuation is an art as much as a science – the areas where judgement is paramount will be made clear.

This course is a ‘must know’ for:
  • Practitioners new to M&A (Mergers and Acquisitions) and valuation, seeking a closer understanding of the principles and practice and how the principal methods are applied in practice.
  • Family business advisors working with SME owners (small and medium-sized enterprises) who are considering a sale, but lack an understanding of basic equity valuation techniques.
This course is also a ‘nice to know’ for:
  • Legal and other advisors seeking a greater understanding of the financial advisor’s role concerning equity valuation.

This course is a practical guide for anyone who wants to learn the initial steps to valuing a business.

Fundamentals is a practical workshop by an experienced trainer that teaches the most common methodologies. Expect to learn discounted cash flows, comparable transactions and comparable quoted companies multiples, concluding with a case study that applies all methods to the divisions of a large and diverse business.

  • Tutor was excellent. He explained things well and went at a good pace. I also felt we covered a decent bit of ground in the short time. Overall very good overview of the valuation fundamentals.
  • The trainer was very knowledgeable and happy to answer questions. The course was excellent.
  • In such organizations, the value of the course is directly related with the technical depth of the instructor and how he passes the knowledge to audience, and as such, I believe that the trainer, and Redcliffe have met this expectation. 
Number of places:
Part 1

£ 695.00

Number of places:
Part 2

£ 695.00

Discounts available:
Virtual Class

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