Valuation project

DISSERTATION GUIDELINES

  1. Aim and Objectives
  • Enable students to advance their knowledge of the field covered by their degree programme
  • Independent research project
  • Ability to evaluate, challenge, modify and develop theory and practice.
  • Offer synthetic and coherent solutions
  1. Requirements
  • Well-defined research question
  • Logically developed argument supported by evidence
  • Element of your own independent research
  • Relate existing literature in the field to your work
  1. Plagiarism
  • Your dissertation should be the output of your own University of London and the College take plagiarism very seriously.
  • Incorrect referencing and citations may be considered plagiarism.
  • For detecting plagiarism, the School uses Turnitin. Turnitin checks your dissertation against 24+ billion web pages, 300+ million student papers and 110,000+ publications and provides a similarity index. Once you will have completed your dissertation, you can test it on Turnitin to verify that the similarity index is acceptable (green light) before your official submission.
  • Important: An acceptable similarity index could be anything below 20%. What does this mean in practice? An originality report from Turnitin may have a similarity index of 24% with the similarity coming from hundreds of different sources, each making up less than 1% of the student’s work, other originality reports with an index of 15% may have the similarity coming from just one or two web pages or published sources, potentially a much more serious matter.
  1. Style and Format
  • Use 1.5 spacing
  • Number your pages
  • Use 2.5 or 3cm on all margins
  1. Dissertation Length
  • 7,000 words excluding references, tables and appendices.
  1. Citing and References
  • Use Harvard Style criteria

 

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Structure for valuation based study

Introduction: It should state the topic and the general aim of the dissertation. It should also describe the structure of the dissertation (i.e. how you organise your dissertation in the various sections)
Methodology and Data Description: it is important that you explain the method(s) you are using to value the company and that you describe the data used in your valuation exercise. You can give any title to this section as long as, at the beginning of the section, you state clearly that the objective of the section is give a description of your method(s) and of the data you use.
Empirical Analysis: this section is dedicated to the illustration of your analysis and of your investment recommendation. You can give any relevant title to this section as long as, at the beginning of the section, you state clearly the objective of the section.
Conclusion: this section presents a summary of the findings of the dissertation, i.e, reviews your investment case about the company you are analysing. The reader of this section is expected to be given a summarized perspective of your view on the company’s fundamentals and investment story backing your investment recommendation.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

VALUATION PROJECT – SUGGESTED TOPICS

Student can choose to do a valuation project for their dissertation.

(Unilever:https://www.unilever.com/ )

Students are expected to produce an investment recommendation report about a listed company (please see below).

VALUING A LISTED COMPANY

Students have to expose their investment case about the selected company, supported in their valuation analysis. The investment recommendation can be to BUY (if valuation higher than market price) or to SELL (if valuation lower than market price) the selected company. The consistency and quality of the investment case and the supporting valuation exercise, both properly explained, are the topics to be evaluated. The investment report is self-contained, i.e. there are no additional elements to be evaluated.

The report should deliver:

  1. a discounted cash flow (DCF) valuation of the stock (common equity) in the company by
  • identifying the key assumptions for the DCF analysis,
  • presenting relevant cash flow tables and applied valuation formulas, and
  • estimating how sensitive the value estimates are to changes in the key assumptions,
  1. a relative valuation of the stock (common equity) in the company by
  • preparing a list of comparable (peer) companies, using criteria that are justified to be appropriate,
  • choosing a multiple that will be used in comparing companies across the peer group,
  • evaluating the company against its peers using the chosen multiple,
  1. a final value estimate and investment recommendation by
    considering the values obtained from discounted cash flow and relative valuation models and reconciling potential differences between the two, and
    • making a final investment recommendation on whether to buy or sell the stock of the company.

 

 

Recommended references

  • https://www.imf.org/external/index.htm
  • Bloomberg professional
  • Bloomberg news
  • Bodie, Z., Kane, A. & Marcus, A. J., 2014. Investments. 10th ed. New York: McGraw-Hill. Brooks, C., 2014. Introductory Econometrics for Finance. 3rd ed. Cambridge: Cambridge University Press.
  • https://corporatefinanceinstitute.com
  • https://www.cnbc.com
  • Damoran, A., 2012. Investment Philosophies. 2nd ed. New Jersey: Wiley.
    David, H., Grinblatt, M. & Titman, S., 2002. Financial Markets and Corporate Strategy. 2nd ed. s.l.:McGraw Hill.

 

 

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