XXX Company Name <a great business at a reasonable price OR cheap

growth OR special situation OR etc>

Date:
Ticker:
Stock price:
Market Cap:
Enterprise Value:

01/23/2015
IBM
$27.44
$17.1B
$17.9B (approx)

ROE (2016 estimate):

2015 P/E:
2016 P/E:
Recommendation:
Target price:

21%
19
16 (my estimate)
Strong Buy
$69 by 2018

<authors name>
MBA Class of xxxx
The University of xxxxxx
<authors email>
<authors phone number>

Executive Summary
Company Description
Investment Thesis
Industry and Competitive Analysis
Management team
Financial Model

2013
(actual)

2014
(actual)

2015
(actual)

Q1-Q32016
(actual) (1)

Segment 1

219.0

259.0

371.0

387.0

516.0

1548.0

Segment 2

976.2

1234.4

1538.7

1683.1

2244.1

6732.4

Segment 3

334.3

453.6

677.9

703.6

938.2

3752.7

Other sales

20.0

19.0

20.0

16.1

21.5

64.4

Total Sales

2078.0

2518.0

3276.0

3476.2

4634.9

13971.0

Fy-2016
(estimate) (1)

2017
(estimate)

Notes

SALES:

GROSS PROFIT:
Segment 1

98.6

116.6

167.0

174.2

232.2

696.6

45% gross margin

Segment 2

390.5

493.8

646.3

706.9

942.5

2491.0

37% gross margin

Page 1 / 2

Segment 3

133.7

Other sales

120.0

110.0

129.4

127.7

Total Gross Profit

847.3

1095.4

1518.9

1623.3

Gross Profit Margin

40.8%

43.5%

46.4%

46.7%

46.7%

39.6%

107.2

165

213.5

245.7

327.6

558.8

4% of sales

358.1

406.4

520.6

508.6

678.1

1397.1

10% of sales

15.7

0.0

-92.6

0.0

0.0

366.3

524

877.4

869

1158.7

3581.6

88.1

113.7

186.4

190

253.3

788.0

278.2

410.3

691

679

905.3

2793.6

13.4%

16.3%

21.1%

19.5%

19.5%

20.0%

R&d expense
SG&A
Other expense
Operating income
Tax/ Finance expense
NET INCOME:
Net Profit Margin

181.4

284.7

295.5

394.0

1388.5

37% gross margin

170.2

299.9

37% gross margin

2164.4

5537.5

Source: XXX annual reports, XXX press releases, YYY Sell side report, and authors estimates
Financial Model Notes:

1)
2)
3)
4)

Excludes one time charge for xxx acquisition.

Assumes 15% operating margins
Assumes 6% unit growth and 3% pricing growth
Etc

Company Valuation & Price Target

1. Peer multiples
2. DCF
3. Private market value

Thesis Risks & Risk Mitigation

Page 2 / 2

22% of Op. Income