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Business Valuation

Code: 2MiF05     Acronym: BV

Keywords
Classification Keyword
OFICIAL Management Studies

Instance: 2024/2025 - 1S

Active? Yes
Responsible unit: Management
Course/CS Responsible: Master in Finance

Cycles of Study/Courses

Acronym No. of Students Study Plan Curricular Years Credits UCN Credits ECTS Contact hours Total Time
MIF 24 Official Syllabus after 2020-2021 1 - 3 21 81

Teaching Staff - Responsibilities

Teacher Responsibility
Miguel Augusto Gomes Sousa

Teaching - Hours

Theoretical and practical : 1,50
Type Teacher Classes Hour
Theoretical and practical Totals 1 1,50
Miguel Augusto Gomes Sousa 1,50

Teaching language

English
Obs.: n.a.

Objectives

Equip students to perform detailed financial analyses of companies, identifying and interpreting key performance indicators to value them using the Discounted Cash Flow (DCF) and the Relative Valuation methods, i.e., employing market multiples to compare and assess companies across different sectors. Enable students to apply the methods above, understanding their assumptions and limitations. Finally, introducing the concept of real options and other contingent valuation methods in business valuation allows students to consider uncertainties and flexibility in investment decisions.

Learning outcomes and competences

By the end of the course, students should be prepared to:

  • Conduct detailed financial analyses of companies, identifying and interpreting key financial performance indicators.
  • Prepare well-founded financial reports.
  • Value companies using the Discounted Cash Flow (DCF) method, understanding its assumptions and limitations.
  • Project future cash flows to calculate company value.
  • Apply relative valuation methods using market multiples.
  • Understand concepts of real options and other business valuation methods, incorporating uncertainties and flexibility into company evaluations.

Working method

Presencial

Pre-requirements (prior knowledge) and co-requirements (common knowledge)

 (i) financial calculation

(ii) use of spreadsheets,

(iii) financial accounting

(iv) corporate finance

Program



  1. The Financial Analysis of a Corporation




  2. DCF Valuation




  3. Relative Valuation



  4. Contingent Valuation

Mandatory literature

Aswath Damodaran; Investment valuation. ISBN: 978-1-118-01152-2
Tom Copeland; Valuation. ISBN: 0-471-08627-4

Teaching methods and learning activities

The teaching methodology consists of a combination of theoretically based approach with the critical analysis of decision-making problems and application of the concepts learnt during the classes to a real case study.

Evaluation Type

Distributed evaluation with final exam

Assessment Components

Designation Weight (%)
Participação presencial 25,00
Trabalho escrito 75,00
Total: 100,00

Amount of time allocated to each course unit

Designation Time (hours)
Elaboração de projeto 20,00
Estudo autónomo 40,00
Frequência das aulas 21,00
Total: 81,00

Eligibility for exams

The final grade in the course needs to be equal to or higher than 10.

Students are evaluated continuously, considering their end-of-class quiz grades (best four quizzes out of six) and their final project/group assignment.

Exam evaluation is unavailable, but students can improve quiz grades on the re-sit date.

Calculation formula of final grade

Final grade= 25% x Quizzes average grade + 75% x Group assignment grade

* Best 4 (out 6)
 

Examinations or Special Assignments

n.a.

Internship work/project

n.a.

Special assessment (TE, DA, ...)

n.a.

Classification improvement

n.a.

Observations

n.a.
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