friday, feb 7 2014 weekly meeting investment club
TRANSCRIPT
FRIDAY, FEB 7 2014WEEKLY MEETING
INVESTMENT CLUB
PREVIEW
1. Market Update
2. Club Overview
3. Interview Tips
4. Stock Fundamentals
Market Update
Expedia Earnings
Reported earnings – Earnings beat estimatesStock appreciated 13% after hoursWas down 4.3% due to search-engine
concernsDifficult to separate from competitorsClub has enjoyed 30% gains
Long-Term Jobless Benefits Rejected
Republicans blocked 3 month extension
Could hurt consumer confidence
Discourages workers to continue job search
Issue could be revived depending on debt limit
Market Volatility
The S&P 500 appreciated 30% - 2013Investors estimate between 8-10% for 2014Reduce positions in U.S. small company
stocksBlue chip stocks / short – term bondsTech giants Apple and Cisco highlighted
Established infrastructure Pay dividends
Improved Labor Market
Fed officials concerned with fast falling unemployment
Contradicts Okun’s LawBy U6 measure, unemployment was 13.1%When should Fed raise rates?
Too quickly: dampen economic recovery Too slow: fuels inflation, financial bubbles
Global Economy
Continued pessimism for economic recoverySentiment based upon:
Tumbling stock prices Fed’s taper of QE Weak U.S. reports in car sales, home sales, hiring Emerging Markets: Brazil growth down 5% since 2011 Concerns in Chinese growth (2nd largest economy)
CLUB OVERVIEW
Investment Club
OVERVIEW: 1. Close to $500,000
2. Over 40 stocks
3. Strictly Student Run
GOALS
1. Manage and Grow Portfolio
2. Educate Members
3. Network
WHY INVESTMENT CLUB?
New Ideas
1. Shareholder Meeting
Ideas
2. Freshman Investing Crash Course
3. Wall Street Panel
Ideas
4. Stock Pitch Battle
5. WSJ Quiz
Ideas
6. Mentorship Program
7. Interview Prep
INTEVIEW PREP
INTERVIEW PREP
NETWORKING, NETWORING, NETWORKING
WHAT YOU NEED:
*** STRONG GPA *** UNDERSTANDING OF MARKETS *** DESIRE TO LEARN
Wall Street Interview
COURSE WORK: - Financial Accounting, Financial Theory, Corporate Finance, ect.
COMMON QUESTIONS
FIT QUESTIONS:
1. How did you prepare for this interview?
- Coursework, WSJ, Barrons, ect.
2. Describe a moment when you worked under pressure?
- Time crunch, stick to basics
Banking Questions
1. What is the main goal of an investment bank? - Get company from point A to B
2. Briefly tell me about recent major financial transactions? 3. Explain Structure of XYZ Bank? - Read 10K
Questions
4. Most important trends in economy?
5. Do you follow a certain stock?
6. Role of a summer intern/ full time analyst?
7. Why XYZ Bank? - CEO: Direction of firm
FINANCIAL QUETIONS
1. How does Net Income influence all 3 financial statements?- Income Statement, Balance Sheet, Cash Flow
2. Basic Methods for Valuing a Company?- Comparable Analysis- Precedent Transaction Analysis- DCF
BRAIN TEASERS
Q: You’ve got a 10 x 10 x 10 cube made up of 1 x 1 x 1 smaller cubes. The outside of the larger cube is completely painted red. On how many of the smaller cubes is there any red paint?
BRAIN TEASER
A: First, note that the larger cube is made up of 1000 smaller cubes. The easiest way to think about this is how many cubes are NOT painted? 8 x 8 x 8 inner cubes are not painted which equals 512 cubes. Therefore, 1000 – 512 = 488 cubes that have some paint. Alternatively, we can calculate this by saying that two 10 x 10 sides are painted (200) plus two 10 x 8 sides (160) plus two 8 x 8 sides (128). 200 + 160 + 128 = 488.
RESOURCES
1. FINANCIAL NEWS OUTLET
2. MACABACUS. COM
3. WALLSTREETOASIS.COM
4. GLASSDOOR.COM
Qualitative Analysis of Tesla (TSLA)
BY BRENDAN GOVER
Common Qualitative Measures
Dan Killmurray ’85 (UBS)
TAM
Moat
Management
Management track record/compensation package
Elon Musk
Previous/current other business ventures
COMMENTS?
How can the club improve?
Suggestions?