Company Valuation

Graduate Program (& Advanced Certificate) Status

Course Level: 
Master’s
Campus: 
Vienna
Course Open to: 
Students on-site
Academic Year: 
2020-2021
Term: 
Spring
US Credits: 
2
ECTS Credits: 
4
Course Description: 

Knowing what an asset is worth and what determines that value is a pre-requisite for intelligent decision making – in choosing investments for a portfolio, in deciding on the appropriate price to pay or receive in an acquisition/divestiture and in making investment, financing and dividend choices when running a business.  The premise of this course is that we can make reasonable estimates of value for most assets, and that the same fundamental principles determine the values of all types of assets, real as well as financial.

This course will equip participants with the various valuation techniques used by business consultants and bankers as well as discuss how the various elements in these models are derived, and equally, how our inherent bias and preconceptions do cloud the valuation process. We will draw upon illustrations faced by real-world companies across a broad spectrum of industries under different circumstances so that participants can grasp the full complexities that underlie each valuation process.

Learning Outcomes: 

Core Learning Area          

Learning Outcomes                                             

Interpersonal and communication skills.         

Participate in class discussions and problem solving exercises. They will be able to present their arguments or findings, persuade fellow students of the usefulness of their own conclusions and objectively critique findings presented by their fellow students

Technology Skills               

Demonstrate an ability to use MS Excel tools in problem solving.

Quantitative Reasoning 

Apply financial models and formulae to evaluate key parameters in the restructuring analysis

Critical Thinking               

Exercise powers of inquiry, logical thinking, and critical analysis of arguments and evidence. Interpret and evaluate theoretical arguments and empirical evidence.

Management knowledge and skills                            

Provide a comprehensive understanding of the principles and techniques of corporate restructuring analysis.  Students are exposed to a number of economic and accounting concepts that practitioners in the field use and apply. 

Assessment: 

The assessment for the course comprises of 4 sections, with weighting as follows: 

5% Peer assessment for Group assignment

15% Class attendance, in-class participation and online project consultations

30% Two in-class mini quizzes

50% Group assignment

 

The grade obtained for the course is marked against the standards of the CEU and as such, is final and non-negotiable. No emails/conversations on trying to better your score will be entertained after the exam.

Adequate class participation is required for passing the class.  You will be called upon to participate or contribute to classwork discussions if your participation score has been inadequate (or non-existent).

The 4-member group assignment requires you to apply the DCF and Relative valuation techniques learnt in class to the valuation of real world companies.  You will assume the role of a long-term valued investor (such as Warren Buffett) seeking to take a substantial equity stake ($10 million or more) in an undervalued firm.  The assignment details will be furnished during Lecture 1.  You will be required to address the questions in the assignment and submit a professional report at the end of the course. 

There is a peer evaluation component to this assignment and it comprises 5% of your final grade.  All team members should provide a peer evaluation, ranking each member (including oneself), and providing a rationale for the evaluation.  Peer evaluation serves as a factor in assessing individual contributions to the success of the project. The project is graded based 50% on individual effort and 50% on group results. The peer evaluation is kept confidential and not shared. 

Prerequisites: 

All enrolled students should have successfully completed core finance (Financial Management) and accounting (Financial Reporting & Control) courses at graduate level.

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