- Improve setting price targets by objectively assessing the market’s psychology towards the stock at present and in the past.
- Better calibrate price targets by correctly identifying the catalyst likely to move the stock and evaluating realistic upside and downside scenarios.
Apply Practical Valuation Techniques for More Accurate Price Targets
Workshop
4 hours
4 hours
Availability
CFA CE Credits
4.0
4.0
The Problem
When generating price targets, analysts too often spend all of their effort on the financial forecast while leaving the valuation multiple as an afterthought, which can lead to bad stock calls. Analysts sometimes knowingly, and often unknowingly, manipulate valuation multiples and methods to reverse engineer their desired price target. In addition, they miss opportunities to utilize valuation for assessing the all-important market psychology surrounding a stock of interest.
The Solution
Analysts can derive more reliable price targets by consistently using key practical valuation techniques. Valuation doesn’t need to be overly complicated, but it should employ the best method for the specific stock call and include a thorough review of the past and present to understand the market’s psychology surrounding the stock’s current valuation. As discussed in the best-selling book Best Practices for Equity Research Analysts, valuation is sometimes an afterthought used to help reverse engineer a pre-determined price target. This is no average valuation class where participants are typically asked to build comp tables or DCF models. In this workshop, AnalystSolutions provides a highly innovative approach to expose the benefits and limitations of the most widely-used valuation methods as well as our unique SHARE™ framework for generating the most reliable and defendable price targets.
This Workshop Will Empower You To…
- Recognize the most common causes that lead to unreliable price targets and learn best practices to improve them
- Understand why valuation is not about discovering one flawless number, but rather correctly assessing market psychology surrounding a stock
- Derive the optimal valuation multiple for a future price target by making appropriate adjustments to the stock’s current valuation multiple
- Identify the benefits and limitations to the most commonly-used valuation methods through our tailored decision tree and decision matrix
- Identify if a stock’s current valuation multiple is: 1) on trend compared to the past; and 2) in-line with other stocks that have similar characteristics
- Set a range of upside, downside and base-case price targets using a range of valuation multiples and assumptions towards the stock’s most important 1-3 critical factors
- Identify and monitor the catalysts that would warrant changing the valuation method or future valuation multiple(s)
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Free Sample Module and Materials From This Workshop
James J. Valentine, CFA
About the Workshop Author and Facilitator
James Valentine, CFA, is the author of the top-selling book Best Practices for Equity Research Analysts and founder of AnalystSolutions. He began his career as an equity research analyst, where the major North American investor polls ranked him among the top three in his sector for ten consecutive years, and Forbes identified him as one of the top three among all 2,000 U.S. sell-side analysts. Between the time as an analyst and founding AnalystSolutions, he held the role of Director of Training for Morgan Stanley’s Global Research department where he implemented a new global training program for 500 analysts and associates. His passion is to help analysts improve performance which he does by conducting presentations and workshops for internationally-recognized conferences, buy-side and sell-side firms, CFA Societies and universities with top finance programs.
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We offer free full versions of our content for evaluation purposes (valued at over $700) to professionals holding the following roles:
- Manager of buy-side or sell-side analysts (DOR or PM)
- CFA Society leader responsible for programming
- Professor teaching students pursuing careers in equity research
You will receive:
- Free GAMMA PI™ assessment
- Free access to our presentation "Are You a Great Analyst?"
- Free full workshop (not "Preview" version), including all materials (Learner Workbook, Slides and Quick Reference Cards)
- Sample chapter of Best Practices for Equity Research Analysts
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