财务分析与证券定价(英文)chapter7

PARTIITheAnalysisofFinancialStatementsTheAnalysisofFinancialStatements1KnowingtheBusinessTheProductsTheKnowledgeBaseTheCompetitionTheRegulatoryconstraintsStrategy2AnalyzingInformationInFinancialStatementsOutsideofFinancialStatements3ForecastingPayoffsSpecifyingPayoffsForecastingPayoffs4ConvertForecaststoaValuation5TradingontheValuationOutsideInvestor:CompareValuewithPricetoBUY,SELLorHOLDInsideInvestor:CompareValuewithCosttoACCEPTorREJECTStrategyChapter7HowbusinessactivitiesarerepresentedinfinancialstatementsChapter8Howthestatementofshareholders’equityisanalyzedChapter9AnalyzingthebalancesheetandincomestatementtorevealprofitabilityChapter10AnalyzingthecashflowstatementtoidentifycashgenerationChapter11AnalyzingprofitabilitytodiscoverwhatdrivesitChapter12AnalyzingresidualearningsgrowthtodiscoverwhatdrivesitChapter7BusinessActivitiesandFinancialStatementsLinksChapter1introducedthefirm’soperating,investingandfinancingactivities.Chapter1Aintroducedthefinancialstatements.Chapter5outlinedavaluationmodelbasedonthosefinancialstatements.LinktoPreviousChaptersThischaptershowshowthethreebusinessactivitiesaredepictedinthefinancialstatements.ItalsoshowshowthestatementsareredesignedtohighlighttheseactivitiesandtopreparethestatementsforapplyingthevaluationmodelinChapter5.ThisChapterChapters7,8and9reformulatestatementsaccordingtothedesigndevelopedinthischapter.LinktoNextThreeChaptersLinktoWebPageHowarethecashflowsofabusinessidentifiedinthecashflowstatement?Howareoperatingandfinancingassetsandliabilitiesidentifiedinthebalancesheet?Howareoperatingandfinancingincomeidentifiedintheincomestatement?Whatmeasurescapturetheoperatingandfinancingprofitability?Whatyouwilllearninthischapter•Howbusinessesareorganizedtogeneratevalueforshareholders•Thedifferencebetweenoperatingandfinancingaspectsofabusiness•Howbusinessactivitiesarereportedinfinancialstatements•Howfinancialstatementsareorganizedtohighlightoperatingandfinancingactivities•Howbusinessactivitiesarticulateandhowfinancialstatementsarticulate•Thefourcashflowsofabusinessandhowtheyrelatetoeachother•WhyfreecashflowdoesnotaffectvalueaddedWhatyouwilllearninthischapter•Asetofaccountingrelationsthatsummarizehowbusinessactivitiesdrivefinancialstatements•Fisnetcashflowtodebtholders(orissuers)•disnetdividendtoshareholdersCashFlowsBetweentheFirmandClaimantsintheCapitalMarketsTheFirmCapitalMarketsFdNetFinancialAssetsDebtHoldersorIssuersShareHolders(NFA)FinancingActivities•Iisnetcashinvestedinoperatingassets•Cisnetcash(flow)fromoperations•C-Iis“freecashflow”•IfNFAarenegative,theyareNetFinancialObligations(NFO)BusinessActivities:AlltheCashFlowsCINetOperatingAssets(NOA)TheFirmCapitalMarketsFdNetFinancialAssetsDebtHoldersorIssuersShareHolders(NFA)OperatingActivitiesFinancingActivitiesTheCashConservationEquationAfundamentalaccountingidentity:•C=Netcashfromoperations•I=Netcashoutflowforinvesting(purchases,divestments)•C-I=Freecashflow•d=Netdividends(includingcommondividends,stockissues...)•F=Netcashoutflowfordebtfinancing(principal+interest)Thetreasurer’srule:If:lendorbuydownowndebtIf:borroworreducelendingCCEFdICdiICdiICFinancialActivities:Stocks&FlowsThecashflowsflowinto/outofthefinancialassets:theirchangemustbeexplainedbythefourflowscomponentsoftheequation.ForFinancialAssets(FA)Forfinancialobligations(FO)(itisinterestpaid)Forgiveninterestpaymentsandnetdividends,cashflowfromoperations(C)reducesborrowingandcashinvestment(I)increasesittttt1ttdiICFAFAtttt1ttdiICFOFOStatementofCashFlowsCashflowsfromoperationsCCashinvestment(I)FreecashflowC-IEquityfinancingflows:DividendsandsharerepurchasesXXShareissues(XX)dDebtfinancingflows:NetpurchaseoffinancialassetsXXInterestonfinancialassets(XX)Netissueofdebt(XX)InterestondebtXXFTotalfinancingflowsd+FBalanceSheetAssetsOperatingassetsOAFinancialassetsFATotalAssetsOA+FAEquitiesOperatingliabilitiesOLFinancialobligationsFOCommonstockholders’equityCSETotalEquitiesOL+FO+CSEBalanceSheetRestatedNOA=OA-OLNFA=FA-FOCSE=NOA+NFAUsuallyNFAisnegative:NFOCSE=NOA-NFOOperatingAssetsOperatingassetsOAOperatingliabilities(OL)NetoperatingassetsNOAFinancialObligations&Owners’EquityFinancialliabilitiesFOFinancialassets(FA)NetfinancialobligationsNFOCommonequityCSETotalNFO&EquityNFO+CSEBusinessActivities:AlltheStocks&Flows•ORisoperatingrevenue•OEisoperatingexpense•NFIisnetfinancialincome•Dindicateschange•NFAcanbenegative(NFO)HoldersorProductandInputMarketsOROECustomersSuppliersOR-OE=OIOI-DNOA=C-IC-I-DNFA+NFI=dOperatingActivitiesFinancingActivitiesCINetOperatingAssets(NOA)TheFirmCapitalMarketsFdNetFinancialAssetsDebtIssuersShareHolders(NFA)IncomeStatement•Thedifferencebetweenoperatingrevenueandoperatingexpenseiscalledoperatingincome:Netfinancingexpensecanbenegative(netfinancialincome)OEOROIIncomeStatementOperatingincomeOperatingrevenueOROperatingexpense(OE)OINetfinancingexpenseInterestexpenseXXInterestrevenue(XX)NFENetincomeNIBusinessActivitiesandtheFinancialStatementsNIt=OItNFEtCASHFLOWSTATEMENTNetOperatingAssetsNetFinancialObligationsNOAt=NOAt-1+OIt-(C