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Build a comprehensive 3-statement model, forecast key KPIs, and develop a full Discounted Cash Flow (DCF) valuation for a company of our choice.
In this Build project you’ll think about a company like a financial analyst at an Investment Bank, Private Equity firm, or Hedge Fund. As a group, we will choose a stock to value. Individually, you will build a full 3-statement financial model and use it for your own DCF valuation of the company. You will use publicly available data to build an income statement, a balance sheet, and a cash flow model. Then, you will project key financial figures into subsequent years. Finally, you will use these assumptions to assess the fair valuation of the company. Familiarity with these techniques will help with understanding what a career in investment banking or investing may look like.
Introductions. Why do we care about company valuation? Why do we discount money? As a group we pick a company we want to build a model for.
What is the EDGAR database and how can we access filings like 10-K and 10-Qs? Introduction to a data provider, TIKR.
We pick out KPIs (Key Performance Indicators) and build out a forecast using them.
How could we forecast KPIs better? We explore Google search data as a potential source of alternative data. Extra credit assignment to find a data source that could provide unique insights into the KPIs we picked.
What is Weighted Average Cost of Capital (WACC)? Why do we care about it as a concept? How do we calculate it? What is Free Cash flow (FCF)?
We calculate Terminal value using our forecasted financials. Then, we discount it back to today’s value.
We go over data tables in excel and build a sensitivity table for our DCF.
Present your model and valuation. Fellow students will ask why you chose the assumptions you did. Defend them like an investor would!
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We'll notify you when projects reopen. In the meantime, you can explore our resources and learn more about our Fellows.
Florentin is a finance Build Fellow at Open Avenues Foundation, where he works with students leading projects in financial analysis.
Florentin is an analyst at Citadel Securities, where he is involved in equities trading. As a fundamental analyst on a trading desk, Florentin provides fundamental overlay to the desk’s trading strategies. This includes bottoms-up valuation of individual companies or top-down analysis of sector- or country-level themes.
Florentin has over 3 years of experience in trading. He graduated from Yale with a degree in Economics. At university, he studied models for risk propensity in decision-making and tested those models empirically.
After a short stint in investment banking, Florentin switched paths to an investing and trading-driven role at Citadel Securities. His experiences make him a useful resource for questions on a career in investment banking, private equity, or hedge funds.