The two exercises that helped me the most this summer was creating a projection and a leverage buyout model. The projection model was my first real test at applying historical data in order to predict a company’s future financial statements. I found this challenging because no longer was I given simple assumptions from my superior, but instead had to research GDP growth rates/inflation in addition to historical data to come up with my own accurate assumptions. After using these values to create my model, I built out a discounted cash flow analysis. Having taken Corporate Finance, I was interested to see how much of the information would translate to the real world. I found that what I was taught in the classroom was much more in-depth and technical than the method used by investment bankers. Instead of performing long calculations to find Betas and a WACC value, majority of these units are simply assumed based on the type of firm.
The leveraged buyout model on the other hand looked like a foreign language when I first gazed upon the excel template. In this model I was looking at the company from the perspective of a Private Equity firm. Although it took me nearly half a week to put together, I can say that I found the work very interesting and could definitely see myself in the future working on the buy side. These two exercises were not only the most challenging, but also helped me better understand if this was the career I wanted to pursue. Majority of an investment banking analyst’s day is spent working through models similar to these. I now know that I have abilities to become a good investment banker and even more importantly I enjoyed the work. Although the job can be challenging and hours sometimes long, I can definitely see myself working at an investment bank next year.
Because of the limited amount of information I am allowed to share, I have attached a couple photos below that help shape the office environment.
Board Room (All of the research and sales and trading analysts meet in this room before the market opens every day. This was possibly the most important meeting and hour of the day because it allowed the research analysts the opportunity to transfer any relevant/new information to their clients)
Written by James Kissell, BC Class of 2017