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Analyst Program (AP) Introductory Meeting

Analyst Program (AP) Introductory Meeting. Wednesday, September 13 th , 2006. Tonight’s Objectives. Introductions Our History Purpose of the Undergraduate Investment Portfolio Benefits of AP and Who Should Join Fund Philosophy and Investment Process Meeting Schedule Questions. History.

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Analyst Program (AP) Introductory Meeting

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  1. Analyst Program (AP)Introductory Meeting Wednesday, September 13th, 2006

  2. Tonight’s Objectives • Introductions • Our History • Purpose of the Undergraduate Investment Portfolio • Benefits of AP and Who Should Join • Fund Philosophy and Investment Process • Meeting Schedule • Questions

  3. History • Analyst Program began mid-Spring of 2005 • Spring 2005: 15 members • Fall 2005 & Spring 2006: 25 members • Some aspects of program were useful and will be renewed, others will change • For serious members willing to meet weekly, engage in equity research, and other activities • Screened for stocks and each group assigned for research • Meetings took one hour (2 groups presented each meeting)

  4. History (cont.) • Divided into teams of 3 – 5 members • Decided on 8 companies to research • Designed one page summary reports • Each group presented a company • Stocks covered AEA, AMTD, COGT, FBR, NOVL, OVTI, OXPS, SNDA

  5. Our Purpose • Successfully manage SIA's $5,000 investment portfolio • Research and Analysis • Teamwork • Education • Investment Presentations

  6. Benefits • Learn about business and investing • How to analyze a business • What makes a good/bad business • What makes a good/bad investment • Gain the experience of managing an investment portfolio • Great for resume/interviews • Apply knowledge to personal portfolio

  7. Who Should Join? • Some knowledge of equity markets and investing • Strong desire to learn more about investing • Willing to dedicate their time and hard work in order help us meet our goals • Interested in a Wall Street career

  8. Philosophy • Invest in companies that appear to be undervalued. We invest based off the company's fundamental values and metrics, not based on momentum or speculation. These companies should have or should be developing a strong competitive advantage. We only invest in companies that meet our criteria, and do not fall outside our metrics. The reasons for purchasing a company should be defined (quantitative and qualitative) at the time of purchase, and should be sold when the company no longer falls in these measures.

  9. How to Find Undervalued Companies • Initial Screen • Price/Earnings Ratio less than 20 • Price/Book value less than or equal to Industry Average • 3-year Average Return on Equity (ROE) greater than or equal to Industry Average • Discounted Cash Flow (DCF) • Business/Financial Analysis • Where to look (handout) • What to look for (handout) • We are here to help!!

  10. Presentations • Sample Presentation on Wednesday, October 4th • Presentations should contain only the information pertinent (point to point presentations) to your investment decision. • PowerPoint • DCF Analysis • Other • Presentation should last no more than 15 minutes • Q&A / Discussion

  11. Schedule • We will meet every Wednesday from 5:00-6:00 in N106 BCC • Week 2: Sept 20th – NO MEETING • Week 3: Sept 26th (Tuesday) – Deloitte & Touche Corporate Finance Presentation • How to value a company? • What is a pitch book and how to create one?

  12. Teams! • Teams will be assigned by the end of this week • At least one experienced member per team • Plan to meet once per week • Other helpful tips…

  13. Schedule (Cont.) • Week 4: Oct 4th • Sample Presentation • Introduction to DCF Valuation Model • Break up into industry/sector groups • Week 5 and beyond… • Research Presentations • Resume/Interview Workshop • Speaker Presentations

  14. Mike Kaczmarek kaczma17@msu.edu 734.231.5011 Questions? Tom Cosper cosperth@msu.edu 248.396.7784 • Investment Portfolio • Presentations • Schedule • Membership

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