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12.0. Introduction to FS MODELING - Coggle Diagram
12.0. Introduction to FS MODELING
Steps in developing a sales-based pro forma model
(1) Estimates revenue growth & future expected revenue
Approach
Top-down
Growth relative to GDP growth
Market growth and market share
Bottom-up
Time series
Return-based measure
Capacity-based measure
Hybrid
Estimate Revenue
Evaluating the presence of economies of Scale
Firm's characteristics
Contributing factors
Economies of Scale
Revenue forecast
Forecast revenue = Historical revenue x (1+revenue growth)
Từ approach xác định revenue growth
(2) Estimate COGS
Calculation
Forecast COGS = (historical COGS / revenue) x (estimate of future revenue)
Forecast COGS = (1 - gross margin) x (estimate of future revenue)
Các yếu tố cần xem xét để dự báo chính xác hơn
Gross margin
Volume and price inputs
Separate forecasting
(3) Estimate SG&A
Characteristics of SG&A
Method
Break out the components of SG&A and consider separately to improve the overall forecast of SG&A expenses
Difference segments have significant differences in SG&A as a percentage of revenue => Forecast separately to product better estimate
(4) Estimate financing cost
Element
Level of gross debt
Market interest rates
Gross interest expense
Result
Net debt
Net Interest expense
(5) Estimate income tax expense and cash taxes
Statutory tax rate
Effective tax rate
Cash tax rate
Bỏ ké
Other items in IS modeling
Dividend
Number of outstanding shares
Unusual charges
(6) Model the balance sheet
Based on items that flow from the IS (working capital accounts - account receivable, acc payable adn inventory)
(7) Estimate CAPEX and net PP&E
Using depreciation and CAPEX (for maitenance and for growth)
(8) Construct a pro forma cash flow statement
Porter's 5 Forces Framework
(giúp xác định COGS & SG&A, revenue too)
(1) Power of suppliers
(2) Power of Buyers
(3) Threat of substitutes
(4) Threat of entry
(5) Intensity of rivalry
Inflation and Deflation
Result :
Changes in input costs
Changes in earnings
Method to avoid
(1). Hedg with derivatives
(2) Pass on to customer
(3) Substitute input
Horizon in analysising (Mốc thời gian lấy để dự báo)
Buy-side analyst
Highly cyclical companies
Impactful events
Relative valuation/Price multiple
Discounted cash flow