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A Very Investment Banking Christmas

Don't take this too seriously Working in Investment Banking During the Holidays Most investment bankers look forward to December for one or two reasons. Senior investment banker schedules (Managing Directors and Executive Directors) are aligned with their clients, so if the client is going on vacation in December then senior bankers will

High Yield Bond Characteristics

High yield bonds are a major financing vehicle for many corporates. After introducing the high yield bond market in the previous post, we will discuss major characteristics of these bonds here. What matters to bondholders? Coupon, maturity, optionality, security, purpose, relative value - the other factors will all inform the ultimate

Introduction to Green Bonds

Debt Capital Markets - What is a Green Bond? Green bonds are debt securities that use the proceeds to fund sustainable and environmental-friendly projects. Given today's investor focus on environmental, social and governance (ESG) factors - whether for political reasons or other ethical considerations, green bonds can be very attractive bond issuances

Modern Portfolio Theory and the Capital Allocation Line

In our Capital Asset Pricing Model post, we discussed risk and return for stocks. We also discussed the use of the relationship to value stocks, by interpolating what the return for a stock should be given a certain level of risk. We will build on these concepts and discuss how

Leasing and Speciality Finance Companies Part II: Element Fleet Management Case Study

Element Fleet Management Primer (TSE: EFN) Element Fleet is the largest publicly traded fleet management company in North America. Element Fleet also has operations in Australia, Mexico and New Zealand. The company primarily provides vehicle leasing along with a range of other services such as vehicle financing, program management, analytics and remarketing

Accounting Estimates: Managing Earnings

In our other accounting estimates articles, we talked about the discretion that management has in the income statement and the balance sheet. In this article, we will dive deeper into the incentives that management may have to manage these estimates. What is Earnings Management? Despite the discretionary nature of some of the

What Makes a Good Leveraged Buyout (LBO) Candidate?

There is a routine answer to this question - a company with large stable free cash flows and low levels of debt. This is usually followed by: How Does an LBO Create Value for Financial Sponsors? Debt paydown, EBITDA growth and multiple expansion. Debt paydown/repayment is easy to understand - if an LBO

M&A Deal Case Study

M&A Transaction Case Studies are commonly seen in case competitions, and often in actual investment banking work. Every time a pertinent transaction in the value range that is relevant to the investment banking group happens, the analyst will prepare a case study for distribution to the broader group. They are