AFC3230 - Financial analysis and valuation

Leader: Associate Professor Paul Mather

Offered

Clayton Second semester 2007 (Day)

Synopsis

Analysis of published financial statements, application and use of financial ratios and forecasting techniques. Cash flow-based share valuation, including discounted cash flow and free cash flow approaches to valuation; accounting-based share valuation including earnings multiples, residual income valuation models and economic value added. Credit analysis and financial distress prediction, equity security analysis and mergers and takeovers, based on Australian and international case studies.

Objectives

The learning objectives of this unit are to:

• access and extract financial information from published financial reports and databases;
• calculate and interpret relevant financial ratios concerned with the profitability, financial structure and solvency of listed public companies;
• apply and critically assess approaches to valuation including discounted cash flow and residual income methods;
• apply valuation methods to contexts such as security valuation, mergers and acquisitions and credit analysis;
• apply critical thinking, problem solving and presentation skills to individual and/or group activities dealing with financial analysis and valuation.

Assessment

Two assignments (5000 words): 40%
Submission of tutorial answers: 10%
Examination (3 hours): 50%

Contact hours

One 2-hour lecture and one 1-hour tutorial per week

Prerequisites

AFC2120 or AFC2140