VFS3e Barton, 3e
ISBN: 0000000000 | Copyright 2023
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| Chapter One: The Link between Valuation and Financial Statement Analysis (pg. 1.1) | |
| Why Valuation? (pg. 1.1) | |
| Use of Accounting Data for Valuation (pg. 1.3) | |
| Why Use Accounting-Based Valuation Models? (pg. 1.4) | |
| Focusing on Operations (pg. 1.6) | |
| Organization (pg. 1.7) | |
| Understanding the Business and the Business Environment (pg. 1.9) | |
| Summary (pg. 1.16) | |
| Questions (pg. 1.17) | |
| Multiple Choice (pg. 1.17) | |
| Mini-Exercises (pg. 1.19) | |
| Exercises (pg. 1.19) | |
| Continuing Examples (pg. 1.20) | |
| Chapter Two: Role of Accounting (pg. 2.1) | |
| Understanding the Relation between Accounting Earnings and Free Cash Flows (pg. 2.1) | |
| Operating Versus Financial Activities (pg. 2.4) | |
| Formalizing the Relation between Free Cash Flows and Accounting Numbers (pg. 2.7) | |
| Demonstrations of the Relation between Free Cash Flows and Accounting Numbers (pg. 2.10) | |
| The Statement of Cash Flows (pg. 2.12) | |
| Summary (pg. 2.13) | |
| Appendix 2A: Financial Statement Articulation and Free Cash Flows (pg. 2.13) | |
| Articulation of Financial Statements (pg. 2.13) | |
| Connection to Free Cash Flows via Reformulation (pg. 2.14) | |
| Questions (pg. 2.16) | |
| Multiple Choice (pg. 2.16) | |
| Mini-Exercises (pg. 2.18) | |
| Exercises (pg. 2.19) | |
| Problems (pg. 2.21) | |
| Continuing Examples (pg. 2.21) | |
| Chapter Three: Reformulation to Identify Operating Activities (pg. 3.1) | |
| Separation of Operating and Financial Activities (pg. 3.1) | |
| The Starting Point: Identifying Operating Income and Assets, NOPAT and NOA (pg. 3.2) | |
| Identifying Net Operating Assets, NOA (pg. 3.7) | |
| Classifying Balance Sheet Items as Operating or Financial (pg. 3.9) | |
| The Equity Section of the Balance Sheet (pg. 3.13) | |
| Identifying Net Operating Profitability after Tax, NOPAT (pg. 3.15) | |
| Deciding if Income Items are Operating or Financial (pg. 3.17) | |
| Financial Statement Linkages (pg. 3.23) | |
| Summary (pg. 3.25) | |
| Appendix 3A: A Detailed Example of Effects of Classification as Operating versus Financial Activitie (pg. 3.26) | |
| Introduction (pg. 3.26) | |
| Classification as Enterprise Operations versus Financial Activities (pg. 3.26) | |
| Calculation of Enterprise Operating Free Cash Flow (FCF) (pg. 3.27) | |
| Detailed Numerical Example of Effects of Classification of Financial Assets as Enterprise Operations (pg. 3.29) | |
| Deciding between the Mingled and Separated Approaches to Classification (pg. 3.35) | |
| Appendix Summary (pg. 3.35) | |
| Appendix References (pg. 3.36) | |
| Questions (pg. 3.37) | |
| Multiple Choice (pg. 3.37) | |
| Mini-Exercises (pg. 3.39) | |
| Exercises (pg. 3.40) | |
| Continuing Examples (pg. 3.49) | |
| Chapter Four: Use of Additional Information to Enhance Reformulation (pg. 4.1) | |
| Additional Information Related to KOOPER TIRE & RUBBER’S Balance Sheet (pg. 4.5) | |
| Information on Pension and Other Postretirement Benefits (pg. 4.9) | |
| Additional Information Related to KOOPER TIRE & RUBBER’S Income Statement (pg. 4.11) | |
| More Information on Pension and Postretirement Benefits OTHER THAN PENSIONS (pg. 4.12) | |
| Appropriate Tax Rate Assumption for Reformulating KOOPER TIRE & RUBBER (pg. 4.13) | |
| Estimating the Cost of Debt Capital For Kooper Tire & Rubber (pg. 4.14) | |
| Summary (pg. 4.16) | |
| Appendix 4A: Detail on Incorporation of Additional Information (pg. 4.16) | |
| Multiple Choice (pg. 4.26) | |
| Mini-Exercises (pg. 4.29) | |
| Exercises (pg. 4.33) | |
| Problems (pg. 4.37) | |
| Chapter Five: Adjusting Accounting Information (pg. 5.1) | |
| The Effect of Accounting Method Choices on Valuation Models (pg. 5.1) | |
| Adjustment A: Inventory Method (pg. 5.3) | |
| Example 1: ConocoPhillips and HollyFrontier (pg. 5.4) | |
| Example 2: General Mills (pg. 5.5) | |
| Adjustment B: Operating Leases (pg. 5.7) | |
| Classification of Leases and the Financial Statement Effects (pg. 5.7) | |
| The Economics of Leases (pg. 5.9) | |
| Determining the Lease Standard Used (pg. 5.9) | |
| Example 1: Operating Lease Adjustments for Delta Air Lines (DAL) (pg. 5.11) | |
| Adjustment C: Special-Purpose Entities (pg. 5.17) | |
| Adjustment D: Share-Based Compensation (pg. 5.19) | |
| Analyzing and Adjusting for Share-Based Compensation (pg. 5.21) | |
| Summary of SBC Adjustments (pg. 5.25) | |
| Reformulation Updated for Additional Information and Adjustments (pg. 5.27) | |
| Summary (pg. 5.30) | |
| Appendix 5A: Examples of Accounting for Share-Based Compensation (pg. 5.34) | |
| Multiple Choice (pg. 5.36) | |
| Mini-Exercises (pg. 5.40) | |
| Exercises (pg. 5.41) | |
| Problems (pg. 5.44) | |
| Chapter Six: Analysis of Enterprise Operations (pg. 6.1) | |
| Evaluating Sales Growth (pg. 6.2) | |
| Evaluating Profitability of Operations (pg. 6.4) | |
| Calculating Return on Net Operating Assets (pg. 6.4) | |
| Disaggregating Return on Net Operating Assets (pg. 6.6) | |
| Operating Profit Margin (pg. 6.6) | |
| Operating Asset Turnover (pg. 6.8) | |
| Trade-Off between Operating Profit Margin and Asset Turnover (pg. 6.10) | |
| Evaluating Financial Activities (pg. 6.11) | |
| Detailed Analysis of Operating Profit Margin (pg. 6.12) | |
| Detailed Analysis of Operating Asset Turnover (pg. 6.13) | |
| Understanding Profitability by Examining Other Companies (pg. 6.16) | |
| Profitability Analysis (pg. 6.18) | |
| Efficiency Analysis (pg. 6.19) | |
| The Mapping from Return on Net Operating Assets to Return on Equity (pg. 6.22) | |
| Advantages and Disadvantages of Equity Versus Debt Financing (pg. 6.23) | |
| Summary (pg. 6.24) | |
| Appendix 6A: Decomposition of Return on Equity (ROE) (pg. 6.24) | |
| Appendix 6B: Informed Ratio Analysis (pg. 6.25) | |
| Quick Ratio (pg. 6.25) | |
| Daily Cash Expenditures (pg. 6.26) | |
| Questions (pg. 6.27) | |
| Multiple Choice (pg. 6.28) | |
| MINI-Exercises (pg. 6.30) | |
| Exercises (pg. 6.30) | |
| Problems (pg. 6.33) | |
| Chapter Seven: Full-Information Forecasting for Valuation (pg. 7.1) | |
| Overview of the Forecasting Process (pg. 7.1) | |
| The Roles of Sales Growth, PM, and ATO (pg. 7.3) | |
| Limited-information Forecasting (pg. 7.4) | |
| Compiling Limited-information Forecasts (pg. 7.8) | |
| Introduction to Industry Analysis (pg. 7.8) | |
| Moving from Limited-information to Full-Information Forecasting (pg. 7.9) | |
| Full-Information Forecasts of Sales Growth (pg. 7.10) | |
| Full-Information Forecasts of Operating Profit Margin (pg. 7.14) | |
| Full-Information Forecasts of Operating Asset Turnover (pg. 7.18) | |
| Preparing for Valuation (pg. 7.21) | |
| Suspect Accounting (pg. 7.23) | |
| Summary (pg. 7.24) | |
| Multiple Choice (pg. 7.25) | |
| MINI-Exercises (pg. 7.27) | |
| Exercises (pg. 7.28) | |
| PROBLEMs (pg. 7.31) | |
| Chapter Eight: Market Multiple Valuation (pg. 8.1) | |
| Use of Accounting Data in Market Multiples (pg. 8.1) | |
| Calculating Market Multiples (pg. 8.3) | |
| Steps to Using Market Multiples (pg. 8.4) | |
| Implementing the Multiples Method for Valuing KOOPER TIRE & RUBBER (pg. 8.6) | |
| Valuation Using an NOA Multiple (pg. 8.8) | |
| Valuation Using a Book Value Multiple (pg. 8.9) | |
| Price-to-Earnings Ratios Observed in Practice (pg. 8.11) | |
| Valuation Using a NOPAT Multiple (pg. 8.12) | |
| Valuation Using a Net Income Multiple (pg. 8.14) | |
| Valuation Using Other Multiples (pg. 8.15) | |
| Valuation Using Operating Forward Earnings and PEG Multiples (pg. 8.15) | |
| Valuation Using Other Multiples, including Sales Multiples or Industry-Based Multiples (pg. 8.17) | |
| Valuation Using a Sales Multiple (pg. 8.18) | |
| Valuation Using the Ratio of (Price − Book) to R&D (pg. 8.19) | |
| Consideration of EBITDA Multiples (pg. 8.19) | |
| Combining Estimates from Differing Multiples (pg. 8.21) | |
| The Product of a Multiples Valuation (pg. 8.22) | |
| Perspective on Valuation Multiples and Fundamental Analysis (pg. 8.23) | |
| Summary (pg. 8.24) | |
| Questions (pg. 8.25) | |
| Multiple Choice (pg. 8.25) | |
| MINI-Exercises (pg. 8.27) | |
| Exercises (pg. 8.27) | |
