Equity Valuation for Analysts and Investors

PART 1 INCOME STATEMENT PRESENTATION 1

Chapter 1 Phase 1: Income Statement and Margin Model, Part 1 5

Chapter 2 Phase 1: Income Statement and Margin Model, Part 2 39

Chapter 3 Phase 2: Segment Modeling of Revenues 63

Chapter 4 Phase 3: Segment Operating Income and Percentageof-

Difference Modeling 73

Chapter 5 Phase 4: The Workbench, Part 1 83

Chapter 6 Phase 4: The Workbench, Part 2 103

Chapter 7 Ordinary Least Squares Regressions and

Normalized Earnings 121

PART 2 RATIO AND VALUATION WORKSHEET 137

Chapter 8 Ratio Analysis, Part 1: Internal Liquidity and

Operating Effi ciency 143

Chapter 9 Ratio Analysis, Part 2: Return Ratios and Cash

Flow Ratios 163

Chapter 10 Historical Comparable Valuation 187

PART 3 STOCK VALUE WORKSHEET 219

Chapter 11 Present Value Modeling and the Stock Value Worksheet 223

Chapter 12 Discounted Free Cash Flow: Setting the Table 235

Chapter 13 Discounted Free Cash Flows: Two Methods 251

PART 4 RELATIONAL VALUATION: THE INDUSTRY

MATRIX WORKBOOK AND PEER DERIVED VALUE 277

Chapter 14 Price and Performance Analysis 283

Chapter 15 Simple Average and Market-Weighted Comparisons 303

Chapter 16 Peer Derived Value 331

Conclusion: Dollar Value of the Asset 359

Bibliography 363