FIN 40610 - Security Analysis

Professor Shane A. Corwin

scorwin@nd.edu

Fall Semester 2009

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Announcements:

• Click here to download the solutions to Homework 1, Homework 2-1, Homework 2-2, and Homework 3.   
• Exam 2 was held on Monday, November 9th. Check back here to view grades and solutions for Exam 2. 
• Exam 1 was held on Monday, September 28th. Click here to view the grades for Exam 1.  Solutions will be posted here when available.
  
• Upcoming Due Dates:
  • Homework #4 is due on Wednesday, November 18th.
  • Group assignment #4 is due on Friday, November 20th.

Course Syllabus:

• Download the syllabus (in pdf format).
  
  

Lecture Notes:

• Course notes will either be provided in class or made available for download from this site.  Additional Notes and Examples will be posted below as they become avaiable.
  
  
• Lecture 1 - Introduction to Valuation
  Financial ratio analysis for Home Depot
  Present Value examples
       Buffett - 2008 Letter to Berkshire Shareholders
       Legg Mason Article - Common Errors in DCF Valuation
       McKinsey Article - The Right Role for Multiples in Valuation
       Economist Article - Blocked Pipes
       Nike Notes to Financial Statements and full 10K. 
  
  
• Lecture 2 - DCF Valuation: Estimating the Cost of Capital
       Example excel spreadsheet for calculating implied premium using the solver function.
  Click here to download an example spreadsheet related to Beta calculations. 
  

• Lecture 3 - DCF Valuation: Estimating and Forecasting Cash Flows
  
• Lecture 4 - DCF Valuation: Forecasting Earnings Growth and Estimating Terminal Value
  
• Lecture 5 - DCF Valuation: Final Issues and Examples
  
• Lecture 6 - Relative Valuation

Homework, Suggested Problems, and Textbook Supporting Materials:

• Information related to the graded homework assignments is provided below: 

Homework Assignments and Due Dates	Homework Solutions
Homework 1 (Nike Notes to Financial Statements &10K)	Homework 1
Homework 2	Homework 2-1 Homework 2-2
Homework 3	Homework 3
Homework 4 (due Wednesday, November 18th)	Homework 4
Homework 5 (due date TBA)	Homework 5
Homework 6 (due date TBA)	Homework 6

• Throughout the semester, I will provide example problems associated with the material we cover in class. Solutions to these example problems will be available below.  Aswath Damodaran also provides extensive data and information to support his textbook.  This information can be accessed at:  Investment Valuation (2nd edition) web page. 

Lecture Summaries and Suggested Example Problems	Answers to Suggested Problems
Lecture 1 - Introduction to Valuation	Lecture 1
Lecture 2 - Cost of Capital	Lecture 2
Lecture 3 - Cash Flows	Lecture 3
Lecture 4 - Growth and Terminal Value	Lecture 4
Lecture 5 - Final Issues and Examples	Lecture 5
Lecture 6 - Relative Valuation	Lecture 6

Exams:

• Exam 1 was held on Monday, September 28th. Click here to view the grades for Exam 1.  Solutions will be posted here when available.
• Exam 2 will be held on Monday, November 9th.
• The Final Exam will be held on Tuesday, December 15th from 1:45-3:45 p.m.  
• You will need a calculator and a formula sheet for all exams.
• Click here to download sample exams and quizzes from previous semesters:  Quiz 1, Quiz 2, Quiz 3, Quiz 4, Quiz 5, Midterm, and Final Exam.
• Additional sample quizzes/exams:  Quiz 1 (answers), Quiz 2, Quiz 3, Quiz 4, Quiz 5, Midterm Exam (answers).

The Valuation Project:

• Click here to download the instructions for the Valuation Project.
• Valuation Project Assignments:
• Assignment 1 - Business and Industry Description (due Monday, September 14th).
• Assignment 2 - Bloomberg Information Collection and Financial Ratio Analysis (due Friday, October 2nd).
• Assignment 3 - Cost of Capital Analysis (due Friday, October 16th).
• Assignment 4 - Cash Flow Analysis (due Wednesday, November 18th).
• Assignment 5 - Growth Analysis (due date TBA).
• Additional Resources:
• Click here to download my example valuation spreadsheet for Home Depot including both FCFF and FCFE valuations. 
• Click here to download Damodaran's example valuation spreadsheets based on FCFF and FCFE.  Numerous other spreadsheets and datasets are available on Damodaran's web site. 
• Click here to download my Black-Scholes spreadsheet.
• Click here to download an Excel Example for calculating Beta.
• Click here to download information related to default spreads by rating category as June 10, 2009.  Click here for previous yield spread data as of August 2008 and November 2008.

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Other Useful Links:
duLac: A Guide to Student Life
The Notre Dame Academic Code of Honor Handbook
Professor Corwin's Page of Finance and Business Links
Books Related to Markets, Trading, and Careers in Finance
Professor Corwin's Home Page
The Finance Department Home Page
The Mendoza College of Business Home Page
The Notre Dame Home Page