Course syllabus OCE - Valuation (ŠAVŠ - WS 2013/2014)

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Course title:
WS 2013/2014
Course supervisor:
doc. Ing. Tomáš Krabec, Ph.D., MBA
Supervising department: Department of Financial Management (ŠAVŠ)
Prerequisites for registration:
Time allowance: full-time, 2/2 (hours of lectures per week / hours of seminars per week)
part-time, 0/16 (lectures per period / seminars per period)
Type of study:
Form of teaching:
lecture, seminar
Mode of completion and credits:
Exam (6 credits)
Course objective:
This course deals with current issues of business valuation. The meaning and basic concepts and methods of valuation should be introduce. There is a strong impact on a view to strengthening the narrow connection with financial and value management. In addition, case studies are to be examined in order to provide a deeper impact to the issue. A special emphasis is placed on newly developed analytical concepts as EVA and MVA and modifications of the DCF models. Other topics for discussion are, e.g., the differences between US and European (continental) approaches to the issues. The main aspects of the capital markets will also be set forth. The lessons will be complemented with seminars bringing the issues in perspective.
Course methods:
-- item not defined --
Course content:
1.Introduction to valuation. Basic terms: understanding financial statements, taxes, cash flow, goodwill, market value and book value, national and international regulation and standardisation, private and public companies. (allowance 1/1)
Basic terms, cash flow and financial statements.

Approaches to valuation, valuation methods. Operating and non-operating assets. (allowance 1/1)
Principles of valuation, case studies.

Using financial reporting information, financial analysis and interpretation of the figures, benchmarking. (allowance 1/1)
Financial analyses of a company. Interpretation.

Strategic analyses: macroeconomic environment, business cycle, product life cycle and meaning of competition, concepts of competition. Business risk and sensitivity analyses. (allowance 1/1)
Strategic analyses. Market data, time series analyses and forecasting.

Capital structure: basic concepts. The choice between equity and debt. Financial leverage and bankruptcy risk. Maximizing firm value. Integration of tax effects and financial distress costs. Dividend policy. (allowance 1/1)
Capital structure and discount rates. WACC.

6.Estimating discounts rates. Riskless rates and risk premiums. CAPM, required rate of return on debt, Gordon dividend model, levered and unlevered cost of equity (allowance 1/1)
CAPM and market valuation.

Valuation of stocks: fundamental and technical analyses. Valuation of whole firms versus valuation of shareholders' equity. Valuing bonds. (allowance 1/1)
Relative valuation. Meaning of multiples. (allowance 1/1)
Relative valuation. Multiples.

Financial planning, building pro-forma financial statements. Projecting financial performance. Estimating free cash flow. (allowance 1/1)
Valuation based on EVA and MVA.

Free cash flow discount models. Estimating growth and terminal value. (allowance 1/1)
DCF models. Case studies.

Relative valuation: fundamental principles. (allowance 1/1)
DCF models. Case studies.

12.Value based management and value enhancement. (allowance 1/1)
a.Valuing a private firm. Case studies.

Mergers and acquisitions. (allowance 1/1)
Mergers and acquisitions. Competition policy regulation. Case studies.

Final presentation of a valuation assignment. (allowance 1/1)
a.Final evaluation.

Learning outcomes and competences:
After completing the course, student:
-Will know and apply cost based valuation methods
Will know and apply main income based valuation methods
-Will know and apply main market based valuation methods
-Will quantify the discount rate
Will understand terminology of business valuation and valuation standards

Teaching methods and workload (hours of workload):
Type of teaching methodDaily attendanceCombined form
Direct teaching
     Attendance of lectures
28 h16 h
     Attendance of courses/seminars/tutorials28 h0 h
     Consultations with teacher (part-time form of study)
0 h
4 h
     Course reading and ongoing preparation
14 h
50 h
     Composing of individual (seminar) work
42 h
42 h
     Composing of presentation
28 h28 h
     Preparation for final oral exam
14 h14 h
     Preparation and final presentation of thesis (MT, BT)
14 h
14 h
168 h
168 h
Assessment methods:
Requirement typeDaily attendance
Combined form
Term paper30 %30 %
30 %
30 %
Final oral exam
40 %
40 %
Total100 %
100 %
Course completion:
Semestral project (written part 30 percent weight of final grade, presentation in seminars 30 weight percent of final grade).
Final presentation of a full valuation report (40 percent weight of the final grade).
Support for combined/distance forms of study:
Teacher's handouts, materials available through the AIS.
Reading list:
BORN, K. Unternehmens-analyse und Unternehmens-bewertung + CD. 2nd ed. Stuttgart: Schäffer-Poeschel, 2003. 325 p. ISBN 3-7910-1763-2.
DAMODARAN, A. The Dark Side of Valuation. 1st ed. Prentice Hall Press, 2001. 479 p. ISBN 0-13-040652-X.
DAMODARAN, A. Investment Philosophies.: Successful Strategies and the Investors Who Made Them Work. 1st ed. New Jersey: John Wiley & Sons Ltd, 2003. 504 p. ISBN 0-471-34503-2.
DRUKARCZYK, J. Unternehmensbewertung (Fourth Edition). München: Vahlen Verlag , 2003.
ERNST, D. -- THIELEN, B. -- SCHNEIDER, S. Unternehmens-bewertungen erstellen und verstehen.: Ein Praxisleitfaden. 2nd ed. München: Verlag Vahlen, 2006. 329 p. ISBN 3-8006-3292-6.

HIGH, J. Competition. Cheltenham – Northhammpton: Edward Elgar , 2001.
KISLINGEROVÁ, E. Oceňování podniku. 2nd ed. Praha: C.H.BECK, 2001. 367 p. ISBN 80-7179-529-1.
KISLINGEROVÁ, E. Manažerské finance+CD.: 2. přepracované a doplněné vydání. 2nd ed. Praha: C.H.BECK, 2007. 745 p. ISBN 978-80-7179-903-0.
MAŘÍK, M. Metody oceňování podniku.: Proces ocenění, základní metody a postupy. 1st ed. Praha: Ekopress, 2003. 402 p. ISBN 80-86119-57-2.
MAŘÍK, M. -- MAŘÍKOVÁ, P. Moderní metody hodnocení výkonnosti a oceňování podniku. 2nd ed. Praha: Ekopress, 2005. 164 p. ISBN 80-86119-61-0.
MAŘÍK, M. Současné problémy oceňování podniku s důrazem na fúze a akvizice. Praha: IOM-VŠE, 2003.
Scherer, F., Ross, D.: Industrial Market Structure and Economic Performance (3. vydání). Dallas, 1990.

Study plans:
-- item not defined --
Run in the period of: WS 2014/2015, WS 2012/2013, SS 2011/2012, WS 2011/2012, WS 2010/2011 (and older)
Course tutor:
doc. Ing. Tomáš Krabec, Ph.D., MBA (examiner, instructor, lecturer, supervisor)
Teaching language:
Mladá Boleslav

Last modification made by Ing. Michal Vejvoda on 06/15/2013.

Type of output: