Hands-On Financial Modeling with Microsoft Excel 2019: Build practical models for forecasting, valuation, trading, and growth analysis using Excel 2019

Description

Explore different aspects of financial modeling with the help of easy-to-follow instructions, productivity tips, and a variety of Excel features and functions Key FeaturesA non-data professional's guide to exploring financial functions and pivot tables in ExcelPrepare various models for income and cash flow statements and balance sheetsPerform valuations and identify growth drivers with real-world case studiesBook Description Financial modeling deals with building digital prototypes of business strategies for core business tasks, such as valuation, profit loss analysis, and growth analysis, that are crucial to decision making. Hands-On Financial Modeling with Microsoft Excel 2019 explains financial modeling concepts and their implementation with the help of Excel. This book starts with an overview of the steps you should follow to build an integrated financial model. You'll explore design principles, functions, and techniques of financial modelling as you learn to implement models in the real world. Starting from key Excel concepts, such as formulas and functions, you'll learn about referencing frameworks and other advanced components of financial models. As you progress through the chapters, you'll thoroughly understand your financial projects, build assumptions, and analyze historical data to develop data-driven models and identify functional growth drivers. The book also takes you through model testing and covers best practices. By the end of this book, you'll have examined data from various use cases and developed the skills you need for using Excel for business and financial modeling. What you will learnIdentify the growth drivers derived from processing historical data in ExcelUse discounted cash flow (DCF) for efficient investment analysisBuild a financial model by projecting balance sheets for assessing profit and lossApply a Monte Carlo simulation to derive key assumptions for your financial modelPrepare detailed asset and debt schedule models in ExcelDiscover the latest and advanced features of Excel 2019Calculate profitability ratios using various profit parametersWho this book is for If you're a data professional, analyst, business owner, or student who wants to develop financial modeling skills, this book is for you. You need not have experience working with data and stats to get started with building financial models; however, this book assumes working knowledge of Excel. Table of ContentsIntroduction to Financial Modeling and ExcelSteps for Building a Financial ModelFormulas and Functions - Completing Modeling Tasks with a Single FormulaApplying the Referencing Framework in ExcelUnderstanding Project and Building AssumptionsAsset and Debt SchedulesCash Flow StatementRatio AnalysisValuationModel Testing for Reasonableness and Accuracy Title Page Copyright and Credits Hands-On Financial Modeling with Microsoft Excel 2019 Dedication About Packt Why subscribe? Contributors About the author About the reviewers Packt is searching for authors like you Preface Who this book is for What this book covers To get the most out of this book Download the example code files  Download the color images Conventions used Get in touch Reviews Section 1: Financial Modeling - Overview Introduction to Financial Modeling and Excel The main ingredients of a financial model Investment Financing Dividends Understanding mathematical models Definitions of financial models Types of financial models The 3 statement model The discounted cash flow model The comparative companies model The merger and acquisition model The leveraged buyout model Loan repayment schedule The budget model Alternative tools for financial modeling Advantages of Excel Excel – the ideal tool Summary Steps for Building a Financial Model Discussions with management Gauging management expectations Knowing your client's business Department heads Building assumptions Building a template for your model Historical financial data Projecting the balance sheet and profit and loss account Additional schedules and projections Cash flow statement Preparing ratio analysis Valuation Summary Section 2: The Use of Excel - Features and Functions for Financial Modeling Formulas and Functions - Completing Modeling Tasks with a Single Formula Understanding functions and formulas Working with lookup functions The VLOOKUP function The INDEX function The MATCH function The CHOOSE function Implementing the CHOOSE function Utility functions The IF function The MAX and MIN functions Implementing the functions Pivot tables and charts Implementing pivot tables Pitfalls to avoid Protect sheets Summary Applying the Referencing Framework in Excel Introduction to the framework Relative referencing Absolute referencing Mixed referencing Implementing the referencing framework Summary Section 3: Building an Integrated Financial Model Understanding Project and Building Assumptions Understanding the nature and purpose of a project Conducting interviews Historical data Building assumptions General assumptions Profit and loss and balance sheet assumptions Profit and loss account growth drivers Year-on-year growth Compound annual growth rate Balance sheet growth drivers Days of inventory Debtor days Creditor days Summary Asset and Debt Schedules Understanding the BASE and corkscrew concepts Asset schedule The straight line method The reducing balance method Approaches to modeling assets The detailed approach Asset and depreciation schedule The simple approach Debt schedule The complex approach The simple approach Creating a loan amortization schedule Creating the template Creating the formulas Using the schedule Summary Cash Flow Statement Introduction to the cash flow statement Items not involving the movement of cash Net change in working capital Cash flow from investment activities Cash flow from financing activities Balancing the balance sheet Troubleshooting Circular references Creating a quick cash flow statement Summary Valuation Absolute valuation Free cash flow Time value of money Weighted average cost of capital Terminal value Calculating the present value Relative valuation – comparative company analysis Trading comparatives  Precedent transaction comparative Summary  Ratio Analysis Understanding the meaning and benefits of ratio analysis Learning about the various kinds of ratios Liquidity ratios Efficiency ratios Return on average assets  Return on average capital employed Return on average equity Debt-management ratios Interpreting ratios Understanding the limitations of ratio analysis Using ratios to find financially stable companies Summary Model Testing for Reasonableness and Accuracy Incorporating built-in tests and procedures Troubleshooting Understanding sensitivity analysis Using direct and indirect methods The direct method The indirect method Understanding scenario analysis Creating a simple Monte Carlo simulation model Summary Another Book You May Enjoy Leave a review - let other readers know what you think