CORPFIN 2502 - Business Valuation

North Terrace Campus - Semester 1 - 2020

This course will provide the framework to price and value both securitised and non-securitised entities (whether that be specific assets or whole companies). This involves the utilisation of both accounting and financial analysis of the entity to determine value. The course will approach the subject from an applied viewpoint to enable participants to practise valuation methods. The course will also incorporate basic capital raising issues, from both the fixed income and equity perspectives.

  • General Course Information
    Course Details
    Course Code CORPFIN 2502
    Course Business Valuation
    Coordinating Unit Business School
    Term Semester 1
    Level Undergraduate
    Location/s North Terrace Campus
    Units 3
    Contact Up to 3 hours per week
    Available for Study Abroad and Exchange Y
    Prerequisites CORPFIN 1002
    Course Description This course will provide the framework to price and value both securitised and non-securitised entities (whether that be specific assets or whole companies). This involves the utilisation of both accounting and financial analysis of the entity to determine value. The course will approach the subject from an applied viewpoint to enable participants to practise valuation methods. The course will also incorporate basic capital raising issues, from both the fixed income and equity perspectives.
    Course Staff

    Course Coordinator: Dr Paskalis Glabadanidis

    Name: Paskalis Glabadanidis
    Location: Room 12.31, 10 Pulteney Street
    Telephone: 8313 7283
    email: paskalis.glabadanidis@adelaide.edu.au
    Course Website: www.myuni.adelaide.edu.au
    Course Timetable

    The full timetable of all activities for this course can be accessed from Course Planner.

  • Learning Outcomes
    Course Learning Outcomes
    On successful completion of this course, students will be able to:

    1. Conduct valuations based on the discounted cash flow method.

    2. Conduct a relative valuation for a company.

    3. Recognize conflicts of interest in valuation contexts

    4. Critically analyse publically available information about what is occurring in financial markets.

    5. Demonstrate a basic understanding of the fixed income securities market
    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)
    Deep discipline knowledge
    • informed and infused by cutting edge research, scaffolded throughout their program of studies
    • acquired from personal interaction with research active educators, from year 1
    • accredited or validated against national or international standards (for relevant programs)
    1-5
    Critical thinking and problem solving
    • steeped in research methods and rigor
    • based on empirical evidence and the scientific approach to knowledge development
    • demonstrated through appropriate and relevant assessment
    1,2,5
    Teamwork and communication skills
    • developed from, with, and via the SGDE
    • honed through assessment and practice throughout the program of studies
    • encouraged and valued in all aspects of learning
    3
    Career and leadership readiness
    • technology savvy
    • professional and, where relevant, fully accredited
    • forward thinking and well informed
    • tested and validated by work based experiences
    4
    Intercultural and ethical competency
    • adept at operating in other cultures
    • comfortable with different nationalities and social contexts
    • able to determine and contribute to desirable social outcomes
    • demonstrated by study abroad or with an understanding of indigenous knowledges
    3
    Self-awareness and emotional intelligence
    • a capacity for self-reflection and a willingness to engage in self-appraisal
    • open to objective and constructive feedback from supervisors and peers
    • able to negotiate difficult social situations, defuse conflict and engage positively in purposeful debate
    1-5
  • Learning Resources
    Required Resources
    Textbook: Damodaran on Valuation, 2nd edition, 2006, John Wiley & Sons
    Online Learning
    Course Lecture notes as well as additional materials (data spreadsheets, etc.) will be made available on MyUni.
  • Learning & Teaching Activities
    Learning & Teaching Modes
    Student learning in this course consists of following lectures supported by problem-solving tutorials developing material covered in lectures.
    Workload

    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 throughout the semester plus one tutorial class each week.
    Learning Activities Summary

    Lecture/Week 1 Topics

    Syllabus/Introduction to Valuation, DCF, Relative Valuation, Contingent Claim Valuation


    Lecture/Week 2 Topics

    Estimating Discount Rates, Measuring Cash Flows



    Lecture/Week 3 Topics

    Forecasting Cash Flows

     
    Lecture/Week 4 Topics

    Equity Valuation Models


    Lecture/Week 5 Topics


    Firm Valuation Models
     

    Lecture/Week 6 Topics

    Mid-Term Test (Week 6, Details: TBA) 
    Relative Valuation: First Principles (3pm-4pm)


    Lecture/Week 7 Topics

    Relative Valuation: Equity Multiples


    Lecture/Weel 8 Topics

    Relative Valuation: Value Multiples, Introduction to Options


    Lecture/Weel 9 Topics


    Options Strategies and Payoffs, Binomial Option Pricing


    Lecture/Week 10 Topics

    Valuing Equity/Debt in the Option Pricing Framework, Real Option Valuation


    Lecture/Week 11 Topics

    Introduction to Fixed Income Securities, Spot/Forward Interest Rates

     
    Lecture/Week 12 Topics

    Bond Valuation Using No Arbitrage Pricing, Term Structure Theories


    Lecture/Week 13 (if needed)

    Final exam overview

  • Assessment

    The University's policy on Assessment for Coursework Programs is based on the following four principles:

    1. Assessment must encourage and reinforce learning.
    2. Assessment must enable robust and fair judgements about student performance.
    3. Assessment practices must be fair and equitable to students and give them the opportunity to demonstrate what they have learned.
    4. Assessment must maintain academic standards.

    Assessment Summary
    Due to the current COVID-19 situation modified arrangements have been made to assessments to facilitate remote learning and teaching. Assessment details provided here reflect recent updates.

    Assessment Task Weighting Due Coverage Learning Outcome
    Online Test 1 30% Wednesday, April 8, 2pm-3pm Quiz covering one-stage DCF models from topics 1, 2, 3 and 4. 1-5
    Online Test 2 30% Wednesday, May 27, 2pm-3pm Quiz covering firm DCF valuation models (topic 6) and relative valuation models (topics 7, 8 and 9). 1-5
    Online Final Exam 40% TBC Coverage of the final exam will be topics 7, 8, 9, 10 and 11. 1-5
    Total 100%
    Assessment Related Requirements
    It is highly advisable that you attend as many of your tutorials as you can. The more material you master during class/tutorial time, the less time you will have to spend studying on your own. Therefore, it is in your best interest to attend all lectures and tutorials for the class. You shouldn't plan on cramming weeks of topics the night before a test or the night before the final exam. It is simply not possible and will most likely backfire.

    Consultation times are on Wednesday between 1pm and 2pm in Nexus building in room 12.31. Please use the phone across the lifts on Level 12 to call the room and I will come and let you in.
    Assessment Detail
    The assessment components are as follows:

    Mid-Term Test (Week 6) 30%

    A 1 hour class test will be held in Week 6 on Wednesday, April 8, 2020 during the first half of the lecture block – location to be annouced. It will cover Discounted Cash Flow (DCF) Valuation up until 2-stage Equity DCF Valuation models (topics 1 through 5 inclusive). The test will be closed book but you can bring in a two-sided A4 cheat sheet with your own notes, formulas, etc., hand-written or typed.

    Course Learing Outcome: 1

    Date and time: 2pm-3pm, Wednesday, April 8, 2020



    Final Exam 70%


    There will be a 3 hour exam covering topics subsequent to the first test (topics 6 through 11 inclusive). You will NOT be allowed to bring in a cheat sheet to the final exam. A formula sheet will be supplied by the lecturer in charge.

    Course Learing Outcome:
    All
    Submission

    No information currently available.

    Course Grading

    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.

  • Student Feedback

    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.

  • Student Support
  • Policies & Guidelines
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