CORPFIN 7039 - Equity Valuation & Analysis (M)
North Terrace Campus - Semester 1 - 2014
General Course Information
Course Code CORPFIN 7039 Course Equity Valuation & Analysis (M) Coordinating Unit Business School Term Semester 1 Level Postgraduate Coursework Location/s North Terrace Campus Units 3 Contact Up to 3 hours per week Prerequisites COMMERCE 7033, ACCTING 7019 & CORPFIN 7005 Corequisites ECON 7200 Course Description The course analyses companies from a fundamental perspective in order to derive an intrinsic value for stock. Topics: Fundamental analysis, determination of growth, discount cash flows models including dividend discount models, free cash flow models and residual income models; relative valuation models including price-earnings and price-book multiples; valuation of private companies, start up companies, companies with negative earnings and mergers and acquisitions.
Course Coordinator: Miss Arti JhuremalaniSemester 2 - Course Coordinator
Miss Arti Jhuremalani
Semester 1 - Course Coordinator
Mr Graeme Gould
The full timetable of all activities for this course can be accessed from Course Planner.
Course Learning OutcomesBy the end of this course students should be able to:
1. Understand and execute various valuation models
2. Analyse financial statements and extract relevant information
3. Recognise and appreciate limitation as well as benefits of valuation models
4. Appreciate the level of subjectivity involved
5. Acquire good research skills
6. Demonstrate good interpersonal communication skills
University Graduate Attributes
This course will provide students with an opportunity to develop the Graduate Attribute(s) specified below:
University Graduate Attribute Course Learning Outcome(s) Knowledge and understanding of the content and techniques of a chosen discipline at advanced levels that are internationally recognised. 1 The ability to locate, analyse, evaluate and synthesise information from a wide variety of sources in a planned and timely manner. 2, 3 & 5 An ability to apply effective, creative and innovative solutions, both independently and cooperatively, to current and future problems. 4 Skills of a high order in interpersonal understanding, teamwork and communication. 4, 5 & 6 A proficiency in the appropriate use of contemporary technologies. 5 A commitment to continuous learning and the capacity to maintain intellectual curiosity throughout life. 1,2,3,4,5 A commitment to the highest standards of professional endeavour and the ability to take a leadership role in the community. 1,2,3,4,5 An awareness of ethical, social and cultural issues within a global context and their importance in the exercise of professional skills and responsibilities. 1,2,3,4,5
Required ResourcesStudy guide, lecture notes & Additional readings. Please read study guide and lecture notes in advance of lectures
Text Books (s) not compulsory, either
Pinto, Henry, Robinson and Stowe, Equity Asset Valuation, 2nd Edition, John Wiley & Sons, 2010.
This can be used as a reference book rather than a text.
Damodaran, Aswath ‘Investment Valuation: Tools and techniques for determining the value of any asset’ 2nd edition, 2002, John Wiley & Sons.
Students can use these texts as reference books.
Recommended ResourcesBenninga, Simon Z and O.H Sarig, Corporate Finance: A Valuation Approach, International Edition, 1997, McGraw-Hill.
Lonergan, W., 2000, The Valuation of Business, Shares and Other Equity, 3rd Edition.
Lundholm, R. and R.Sloan. 2007. Equity Valuation and Analysis. 2nd Edition.
Reilly, Frank K. and K.C. Brown, Investment Analysis and Portfolio Management, 7th Edition, 2002.
JASSA (The Finsia Journal of Applied Finance) Australian professional/ academic publication
Financial Analysts Journal. US professional/ academic publication
Arzac, E.R., Valuation for Mergers, Buyouts, and Restructuring, 2005, John Wiley & Sons.
Copeland, T., T.Koller and J.Murrin, Valuation: Measuring and Managing the Value of Companies, 3rd Edition, 2000.
Learning & Teaching Activities
Learning & Teaching Modes
No information currently available.
The information below is provided as a guide to assist students in engaging appropriately with the course requirements.The University expects full-time students (i.e. those taking 12 units per semester) to devote a total of 48 hours per week to their studies. This means that you are expected to commit approximately 9 hours for a three-unit course or 13 hours for a four-unit course, of private study outside of your regular classes. Students in this course are expected to attend all lectures (2 hour) throughout the semester plus one tutorial class (1 hour) each week.
Learning Activities Summary
Week Number W/B Topic Number Topics Study Guide Tute Number 1 March 3 1 An introduction to valuation & financial maths Chp 1 2 March 10 2 Understanding financial reports Chp 2 1 3 March 17 2 Understanding financial reports Chp 2 2 4 March 24 3 Discounted cash flow models- DDM, FCF & APV Chp 3 3 5 March 31 3 Discounted cash flow models- DDM, FCF & APV Chp 3 4 6 April 7 4 Fundamental analysis and forecasting Chp 4 April 14 Mid-semester Break Chp 5 April 21 Mid-semester Break Chp 5 7 April 28 5 Estimating the discount rate Chp 6 5 8 May 5 5 Estimating the discount rate Chp 7 6 9 May 12 6 Market based valuation Chp 7 7 10 May 19 7 Takeovers Chp 8 8 11 May 26 7 Takeovers
9 12 June 2 8 Financial distress, cross shareholding and private firms 10 Closing thoughts and overview 13 June 9 To be advised
Please consult the Study Guide for appropriate text references on each topic.
Supplementary Reading: For Topic 2: Understanding financial reports, please consult text & notes for Accounting Concepts and Methods (M) and any introductory accounting text. For other topics readings are indicated in the Study Guide for interested students. Changes to the course: Residual Income Model and Technical Trading will not be covered in the course.
The University's policy on Assessment for Coursework Programs is based on the following four principles:
- Assessment must encourage and reinforce learning.
- Assessment must enable robust and fair judgements about student performance.
- Assessment practices must be fair and equitable to students and give them the opportunity to demonstrate what they have learned.
- Assessment must maintain academic standards.
Assesment Due Date and time Weighting Related Learning Outcome Assesment 1 Monday, March 24th, 4 pm 10% 1-6 Assesment 2 Monday, May 26th, 4 pm 20% 1-6 Mid-Term test Week beginning, April 7th 20% All Final Exam 50% All
Assignment 1: 10 %Details: The assignment is compulsory and is available on the ‘myuni’ website. Assignments can be done individually, in pairs or groups of 3 students maximum. The assignment is non-redeemable.
Assignment 2: 20 %Details: The assignment is compulsory and is available on the ‘myuni’ website. Assignments can be done individually, in pairs or groups of 3 students maximum. The assignment is non-redeemable.
Mid-semester test: 20%Short- answer questions covering topics 1-3. Closed book.
Held week beginning, April 7th Bonython Hall (time to be confirmed)The final exam will be of 2.5 hours duration. A formula sheet will also be provided with the exam paper (see end of course outline).
Final Exam: 50%
Assessment Related RequirementsNotes on Assessment
1. To gain a pass for this course, a mark of at least 45% must be obtained on the examination as well as a total of at least 50% overall. Students not achieving the minimum exam mark will be awarded no more than 49.
2. Legible hand-writing and the quality of English expression are considered to be integral parts of the assessment process. Marks may be deducted in the final examination because of poor hand-writing.
3. Assessment marks prior to the final exam will be displayed on the course website. Students are encouraged to check their marks and notify the Lecturer-in-Charge of any discrepancies.
4. Students in this course are permitted to take a DICTIONARY (English) into the examination and calculator. A formula sheet will be provided in the exam (see attached).
No information currently available.
Assignments are compulsory and will be posted on the ‘myuni’ website.
Electronic submissions must be submitted for Assignment 1.
Hard copies must be submitted for Assignment 2. Electronic submissions will not be accepted without receiving prior permission from the Lecturer in Charge.
PRESENTATION OF ASSIGNMENTS
• Please must retain a copy of all assignments submitted.
• Please attach an ‘Assignment Cover Sheet’, which is signed and dated by you before submission for Assignment 2.
• All group assignments must be attached to a ‘Group Assignment Cover Sheet’, which must be signed and dated by all group members before submission. All team members are expected to contribute approximately equally to a group assignment.
Lecturers can refuse to accept assignments, which do not have a signed acknowledgement of the University’s policy on plagiarism.
ASSIGNMENT GUIDELINES INCLUDING REFERENCING DETAILS
A copy of the Postgraduate Programs: Communication Skills Guide will have been given to you at the beginning of your program. This guide will assist you structure your assignments. A copy of the guide can also be downloaded from http://www.business.adelaide.edu.au/current/mba/download/2009MBACommSkillsGuide.pdf
This publication also provides guidelines on a range of other important communication skills including writing essays and management reports, making oral presentations etc.
In preparing any written piece of assessment for your postgraduate studies it is important to draw on the relevant ‘literature’ to support critical analysis. Also essential is to reference the literature used. Correct referencing is important because it identifies the source of the ideas and arguments that you present, and sometimes the source of the actual words you use, and helps to avoid the problem of plagiarism. (Further information on plagiarism is provided later in this course outline.)
The Harvard system is widely used in the Business School. Guidelines for the use of this style of referencing can be found in the Communication Skills Guide.
Further assistance with referencing is available from the Faculty’s Learning Support Advisors. The contact details are provided on page 6 of the Communication Skills Guide.
LATE ASSIGNMENT SUBMISSION
Students are expected to submit their work by the due date to maintain a fair and equitable system. Extensions will generally only be given for medical or other serious reasons. All requests for extensions must be emailed to the lecturer in charge of the course before the due date. Each request will be assessed on its merits. A late assignment (without prior arrangement) will be penalised by a 20% mark reduction for each day that it is late. Assignments are non-redeemable.
RETURN OF ASSIGNMENTS
Lecturer’s aim to mark and return assignments to students within three (3) weeks of the due date with written feedback. Students are responsible for collecting their marked assignments from their tutorial classes. If assignments are not collected after two (2) weeks, the assignments will be available at the Student Hub for two (2) weeks.
Grades for your performance in this course will be awarded in accordance with the following scheme:
M10 (Coursework Mark Scheme) Grade Mark Description FNS Fail No Submission F 1-49 Fail P 50-64 Pass C 65-74 Credit D 75-84 Distinction HD 85-100 High Distinction CN Continuing NFE No Formal Examination RP Result Pending
Further details of the grades/results can be obtained from Examinations.
Grade Descriptors are available which provide a general guide to the standard of work that is expected at each grade level. More information at Assessment for Coursework Programs.
Final results for this course will be made available through Access Adelaide.
The University places a high priority on approaches to learning and teaching that enhance the student experience. Feedback is sought from students in a variety of ways including on-going engagement with staff, the use of online discussion boards and the use of Student Experience of Learning and Teaching (SELT) surveys as well as GOS surveys and Program reviews.
SELTs are an important source of information to inform individual teaching practice, decisions about teaching duties, and course and program curriculum design. They enable the University to assess how effectively its learning environments and teaching practices facilitate student engagement and learning outcomes. Under the current SELT Policy (http://www.adelaide.edu.au/policies/101/) course SELTs are mandated and must be conducted at the conclusion of each term/semester/trimester for every course offering. Feedback on issues raised through course SELT surveys is made available to enrolled students through various resources (e.g. MyUni). In addition aggregated course SELT data is available.
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Policies & Guidelines
This section contains links to relevant assessment-related policies and guidelines - all university policies.
- Academic Credit Arrangement Policy
- Academic Honesty Policy
- Academic Progress by Coursework Students Policy
- Assessment for Coursework Programs
- Copyright Compliance Policy
- Coursework Academic Programs Policy
- Elder Conservatorium of Music Noise Management Plan
- Intellectual Property Policy
- IT Acceptable Use and Security Policy
- Modified Arrangements for Coursework Assessment
- Student Experience of Learning and Teaching Policy
- Student Grievance Resolution Process
Students are reminded that in order to maintain the academic integrity of all programs and courses, the university has a zero-tolerance approach to students offering money or significant value goods or services to any staff member who is involved in their teaching or assessment. Students offering lecturers or tutors or professional staff anything more than a small token of appreciation is totally unacceptable, in any circumstances. Staff members are obliged to report all such incidents to their supervisor/manager, who will refer them for action under the university's student’s disciplinary procedures.
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