Financial analysis and valuation
Information sources
20/4-2010
Sigrid.n.gimse@bi.no
Librarian
BBA
Information sources today
• The case of Givaudan S.A.
• ..both from the Library at BI
• ..sources on the web and beyond
http://en.wikipedia.org/wiki/Company_valuation
Enterprise valuation - information
sources
• ” The critical success factors is to have extensive knowledge of
the company enterprise and industry”
• In what industry is the company?
• More than one industry?
• Business valuation
Nytveit, Trond Stian. 2007. Verdsettelse : en studie av Norsk Hydro. URI: http://hdl.handle.net/2330/1600 . Master
Thesis NORGES HANDELSHØYSKOLE
You need to understand the company or asset
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What drives the value behind that
Financial statements
Audited statements
Tax returns
Press releases
Understand how the market is looking at the company,
products or brand
• Shareholders agreements
• Business plans
• History, developments, M&A
Company Valuation - definitions
• In finance, valuation is the process of estimating the potential
market value of a financial asset or liability. Valuations can be
done on assets (for example, investments in marketable
securities such as stocks, options, business enterprises, or
intangible assets such as patents and trademarks) or on
liabilities (e.g., Bonds issued by a company).
• Valuations are required in many contexts including investment
analysis, capital budgeting, merger and acquisition
transactions, financial reporting, taxable events to determine
the proper tax liability, and in litigation.
http://en.wikipedia.org/wiki/Company_valuation
Business Enterprise - Valuation
information
• The market value is determined by multiplying the quoted share price of
the company by the number of shares.
• Valuation approach is the general way which is followed to determine a
value indication of a business, corporate ownership interest, security, or
intangible asset.
• Business Valuation is an estimation of the market value of a corporation /
business. It differs from appraisal in the sense that appraisals only takes
into consideraton the tangible assets, but a valuation considers intangible
assets.
Company valuation definition
• A way of judging the performance of a business as compared
to others in the same line. Financial studies are conducted
whereby comparative benchmarking is done for this purpose.
Through these industry insights, the value of a business can
also be assessed.
• Business Valuation terms / how much is my business worth
The Givaudan company
• ..is it in good health?
• Several information seeking tasks ahead if you’re going to find
out
http://en.wikipedia.org/wiki/Company_valuation
Company overview - homepage
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Consists of…?
Tangibles or intangibles?
Google for website
..any hard facts there?
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What are sales talk and what are the breakdown facts?
Annual report?
The latest Quarterly?
Anything else you should look for?
Investor Relations
• You’re the auditors and are personally responsible!
http://www.givaudan.com/givcom/
The company analysis - homepage
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What are their business ideas?
What do they sell exactly
Goals, strategies ?
What is all the talk of sustainability? Any thoughts?
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What’s all that about?
Do the Swiss have a good record on corporate social responsibility?
• Do the company have any famous brands – any value there?
• Market value as in reputation?
• Goodwill?
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Wikipedia?
http://www.givaudan.com/givcom/
Are they listed or unlisted / public of
private?
• Stock prices gives you market confidence and expectations
• How can you find out?
Google finance for latest stock prices
• Check Google Finance- http://www.google.com/finance
• Do a search on Givaudan SA
– Note down the stock symbol/ticker
– Todays stock price compared to homepage? Any surprises?
– Negative development?
– Compare info with company website info
– Any surprising news?
– The segments – how to valuate the different segments of the
corporation? All in the same industry?
• Yahoo Finance - http://finance.yahoo.com/
http://www.givaudan.com/givcom/
Yahoo Finance
• - http://finance.yahoo.com/
– Do a search for the company – will get you
what info?
– http://finance.yahoo.com/q?s=GVDNY.PK
– GIVAUDAN SA (GVDNY=US) 2-weeks
forecastPechala's Reports(Apr 9)
Did they succeed in 2009?
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How are they doing, really?
How can you tell?
Any explanations of the results from the latest quarterly?
Financial statements newer than the latest Quarterly?
..for latest developments and trends
Does homepage give you all you need?
http://www.givaudan.com/givcom/
Competition
• Screen competitor - International Flavors & Fragrances Inc. –
Google them for home page
• Compare with Givaudan home page for first impression
• Check them out in Google Finance too.
• Note down ticker symbol
http://www.givaudan.com/givcom/
FACTIVA – a source brought to you by the BI
Library
• Not on the free web
• Check Factiva for company analysis
• Search this way –
• Find the tab - Companies & Markets
– -> Company
– - > Company name – Givaudan SA
The BI Library -> Databases -> Factivca
Factiva charting
• Compare with International Flavors & Fragrances Inc.
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Differences in stock price?
Size
Number of employees
Development
Company strategy
Segments etc.
Stock prices
• Factiva - history & valuation - market valuation
• Portfolio risk & return
• Stock prices and variances
Givaudan AG
IFF
Givaudan AG
IFF
Givaudan AG
IFF
Givaudan AG
IFF
Factiva charting
Factiva charting
Factiva charting
Factiva Comparison
Industry/Market value?
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Industry – how is the company doing in it’s industry?
How is the industry doing?
Market share and volume
How is the market doing?
Growth in demand?
Impediments to growth?
Trend indicators? Identifying a trend?
Consumer demographics? Any changes?
Business Source Complete for industry profile
Industry overview
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What kind of industry is the Fragrance and Flavour industry?
Exposure to risk?
Dependent on overall volatile economic conditions?
How is the overall world market doing – where can you find info?
EUROSTAT –
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http://epp.eurostat.ec.europa.eu/portal/page/portal/eurostat/home
• Swiss Stock Exchange
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http://www.six-swiss-exchange.com/index.html - find Givaudan SA here
How is the rest of the stock market doing
• Find out about risks – where’s the company’s largest markets?
• How’s these regions doing macroeconomically?
• What about interest rates? On the rise or stable?
Industry forecasts & overview
Company & Industry overview
• Check Factiva for a news search of the company or industry
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might be some stock reports who analyzes the company financials and recent news
Company Strategy
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Find out about their strategy
Find a competitor and benchmark strategy
You’re to look for any diverging major differences
Do the competitor have a different, smarter strategy?
Should your company be doing likewise?
Your evaluation? Good, sound strategic choices?
http://www.givaudan.com/givcom/
Amadeus - financial statements and more
• Amadeus - for large western companies – bakwards for 10
years
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M&A
Financials
Graphs
Subsidiaries, se graph for this
company structure and segments
• Business Source Complete – for large companies, industry
reports, market reports, SWOT analyses
BUSINESS SOURCE COMPLETE
For company news
For industry profiles
Media coverage
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News
Older articles – any scandals lately?
Social media? What’s brewing?
Consumer attitudes
Company reputation
Social media
• http://boardreader.com/ - tracks Discussion Forums, Search message
boards and forums
• LinkedIn.com – see Givaudan - Company Profile on LinkedIn
– see news & who works where & contact people
• http://www.blogsearch.google.com – could be useful for official &
unofficial news – but be careful with your sources – must be trustworthy!
Free sources on the web?
• Most of them are commercial…
• The Library web pages -> Database list
supplies you with most of what you need
• Happy searching!