Since one of the requirements of the class is participation, attendance is required. All absences require an email note explaining the absence. This note is required no later than the day that you return to class from an illness. For personal reasons, the note should be sent in advance of the scheduled absence. It is your responsibility to obtain class notes and handouts, and to make-up all missed assignments.

To obtain a solid foundation of knowledge of stock valuation and understand the role security analysis plays in the valuation process.

Learning Objectives: Upon completing this course, the student should be able to:

• understanding the process, assumptions, and limitations of various valuation models as they pertain to equity securities;
• understanding the role market, industry, and firm specific factors play in the valuation process;
• being able to utilize spreadsheets (such as Excel or Lotus) as an aid in the valuation process;
• being able to utilize computer data bases (Ibbotson, Bridge, and the World Wide Web) as an aid in the valuation process;
• being able to effectively communicate in both written and oral formats, the valuation results and supporting documentation.

This course is an elective finance course in the Investment track focusing primarily on equity. It covers the factors influencing the valuation of financial securities: earnings forecasts and expectations, uncertainty, required returns, supply and demand for securities and funds, level of interest rates, and investors' attitudes. The course material will be conveyed through a variety of formats such as lectures, class discussions, selected readings, and current events. Performance evaluation will be determined through written and oral reports, quizzes, and a final exam. Much of the learning will come from your own individual work and from interactions with other students. Accordingly, the benefits that you receive from this course will be directly related to your individual effects. Fin 324 will require a number of written reports that will hopefully improve your writing skills.

Absences will result in a grade of zero for the missed quiz or exam. Plan your schedule, so that you can take all quizzes and the final exam. Quizzes will be announced at least one class period prior to being given. You are expected to bring a financial calculator to all evaluations.

The class will be divided into teams of 5-7 students each. Team assignments include a number of write-ups, presentations, and leading current event discussions. Therefore, the grade that you receive for the course will be influenced significantly by the performance of your team (44% of total grade). Thus, this course provides the opportunity for group participation and leadership, skills that are valuable throughout life. All major group assignments must include a signed Grade Allocation Sheet (discussed later).

Each team will be assigned at least one oral presentation. Each oral presentation should answer all the relevant information but the presentation should be done from the vantage point of consultants. Presenters should be prepared to answer questions from the instructor and their fellow classmates. The use of overheads to explain facts, figures, and calculations are a must. All overhead slides or other presentation material used should be turned in for evaluation.

Each team will be responsible for analyzing and writing up solutions to a number of assignments. Complete written solutions for all assignments are due at the beginning of class on the dates assigned and ALL REPORTS MUST BE TYPED. All major reports should follow the format outlined below and be written from the viewpoint of consultants.

EXECUTIVE SUMMARY: Each write-up must include an executive summary. The executive summary is a one-page overview of everything covered within your report, including the overall solution (1-page Maximum).

BODY OF REPORT: The body of the report should include an introduction and a conclusion. As consultants, your report should address all relevant questions as well as factors that are disturbing such as limiting assumptions or ethical implications of suggested alternatives. DO NOT write your report in the style of "The answer to question 1 is . . .". Also resist the temptation to use statements like "See Exhibit 3" without explaining the data within the text of the report. Expand the statement to something like the following: "The current ratio is 2.3x, which is below the industry and peer group average, and it has been declining over time. See Exhibit 3 for a detailed analysis of the ratio calculations."

C. EXHIBITS: Tables, graphs, and detailed equations should be placed in exhibits to avoid disrupting the flow of the report. Exhibits should be used to illustrate, explain, and elaborate on points made in the report text, but it should be possible for the reader to follow the report without ever referring to the exhibits. Exhibits should also be stand-alone documents, so include relevant titles and highlight the important figures or equations.

D. REFERENCES: Document the sources of all information used.

NOTE: All assignments are to be turned in on the date due. Failure to turn an assignment in on time will result in an automatic grade reduction of 10% per day (i.e. 10% turned in late but on the due date; 10% additional for each day after the due date). No credit will be given after the assignment is returned to the rest of the class.

The grade allocation sheet (GAS) is a statement allocating the team grade to the individual team members. Each member must sign the GAS and agree upon the weights to be used to allocate the grade among the team members. The average group weight must be 100% of the over-all case grade, but your group can assign individual weights from a low of 50% to a high of 150% of the overall grade. This allocation system is the only fair way to distribute the grade in accordance with the work of the individual members. If you work harder than other members of the team, you should expect and demand a higher allocation. A member that contributes less than average to the team effort should expect to receive less than an average grade allocation. The team must decide itself how the grade is to be allocated. The assignments will NOT be accepted without a signed GAS. Since each member must sign the GAS, each individual member must be satisfied that the weight allocation is proper before he or she signs. There will not be any "arbitration process" by the instructor, this must be a team decision accepted with understanding and compromise among the members.

EXAMPLE: Team Grade (90%)

*Note: No team member can receive a score higher than 100% on any assignment.

Each group is required to lead several discussions on current events throughout the semester. Each group member should contribute to the discussion as well as coordinate responses from the rest of the class.

Each student is required to write a report focusing on the impact of ethics (or lack of ethics) within the investment field. Your report can focus on a specific event that has occurred recently, or be more general in nature. Remember that your report will be evaluated not only on the facts, but also on the way in which the information is presented. The individual ethics reports are due on Wednesday, March 28, 2001. The format should follow the style outline under group write-ups. The body of the report should be between 4 and 6 pages.

I. The Investment Environment

Chapters: 1, 2, 3, 4

Chapters: 5, 6, 7, 8, 9, 10, 11

Chapters: 12, 13, 14, 15, 16, 17

Chapters: 18, 19, 20, 21, 22, 23, 24, 25

Chapter 26