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Spreadsheet ProgramsHi! With time, the number of spreadsheets on this page has also increased. To help you in finding the

spreadsheet that you might want, I have categorized the spreadsheets into the following groups:

1. Corporate finance spreadsheets: These spreadsheets are most useful if you are interested in conventional

corporate financial analysis. It includes spreadsheets to analyze a project's cashflows and viability, a company's

risk profile, its optimal capital structure and debt type, andwhether it is paying out what it can afford to in

dividends.

2. Valuation Inputs Spreadsheets: In this section, you will find spreadsheets that allow you toa. Estimate the right discount rate to use for your firm, starting with the risk premium in your cost of equity and

concluding with the cost of capital for your firm.

b. Convert R&D and operating leases into capitalized assets

c. estimate the right capital expenditures and diagnose the terminal value assumptions to see if they are

reasonable.3. Valuation Model Reconciliation: In this section, you will find spreadsheets that reconcile different DCF

approaches - FCFE versus Dividend Discount Model, FCFE versus FCFF model, EVA versus Cost of capital

and Net Debt versus Gross Debt Approaches.

4 . Big-picture valuation spreadsheets: If you are looking for one spreadsheet to help you in valuing a company, I

would recommend one of these 'ginzu' spreadsheets. While they require a large number of inputs, they areflexible enough to allow you to value just about any company. You do have to decide whether you want to use a

dividend, FCFE or FCFF model spreadsheet. If you have no idea which one will work for you, I would suggestthat you try the "right model" spreadsheet first.

5 . Focused valuation spreadsheets: If you have a clear choice in terms of models - stable growth dividenddiscount, 2-stage FCFE etc. - you can download a spreadsheet for the specific model in this section.

6. Valuation of specific types of companies: Valuation is all about exceptions, and these spreadsheets are

designed to help value specific types of companies including:

a. Financial Service firms: While dividend discount models tend to be the weapon of choice for many, you will

find an excess equity return model here.

b. Troubled firms: You will find an earnings normalizer spreadsheet, a generic valuation model for valuing a firm

as a going concern and a spreadsheet that allows you to estimate the probability that a troubled firm will not

survive.

c. Private companies: You will find spreadsheets for adjusting discount rates and estimating illiquidity discountsfor private companies.

d. Young and high-growth firms: You will find a revenue growth estimator as well as a generic valuation model

for high growth firms in this section.

7 . Multiples: You can estimate equity as well as firm value multiples, based upon fundamentals.

8 . Valuation in Acquisitions: You can value synergy in an acquiisition and analyze a leveraged buyout.

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9 . Valuation of other assets: In this section, you will find a model for valuing income-generating real estate.10 . Value Enhancement Spreadsheets: In this section, you will find a spreadsheet that reconciles EVA and DCF

valuation, a model for estimating CFROI and a DCF version of a value enhancement spreadsheet.11. Basic option pricing models: In this seciton, you will find Black-Scholes models for valuing short term

options, long term options and options that result in dilution of stock (such as warrants). In addition, you will find

spreadsheets that convert Black-Scholes inputs into Binomial model inputs and use the binomial model to value

options.12. Real option models in corporate finance: In this section, you will find three basic real option models - the

option to delay, the option to expand and the option to abandon. In addition, the value of financial flexibility is

considered as an option.13. Real option models in valuation: In this section, you will find models to value both a patent (and a firm owning

a patent) as an option, natural resource firms and equity in deeply troubled firms.These spreadsheet programs are written in Excel and are not copy protected. Download them and feel free to

modify them to your own specifications. I do have video guides available for some of the most accessedspreadsheets. I hope they are useful.

One more point. I am not an expert on Microsoft Excel and am frankly mystified by some of the quirky

differences between the Mac version (which I use) and the PC version (which you probably have). If you want

to refine your spreadsheet skills, you can of course by a book on Excel. However, a reader of this website, AlexPalfi of Tykoh Training, has been kind enough to offer this guide to using and building spreadsheets. Please feel

free to download it and use it and to then convey your appreciation to him.

Program Video guide Description

CorporateFinance

capbudg.xls This spreadsheet allows you to do a basic capital budgetinganalysis for a project, and compute NPV, IRR and ROI.

risk.xls

This spreadsheet allows you to use past returns on a stockand a market index to analyse its price performance

(Jensen's Alpha), its sensitivity to market movements (Beta)and the proportion of its risk that can be attributed to the

market.

riskchecker.xls WebcastThis spreadsheet allows you to check your computations ofJensen's alpha, range on beta and expected return, given

the output from a return regression (risk.xls above).

levbeta.xls

This spreadsheet allows you to enter the current beta, tax

rate and the debt equity ratio for your stock, and obtain atable of betas at different debt ratios.

oplease.xls WebcastThis spreadsheet allows you to convert lease commitments

to debt.

ratings.xls

This spreadsheet allows you to estimate a rating and a cost

of debt for your company from the firm's interext coverageratio.

apv.xls

This program allows you to estimate an "optimal" Capital

Structure for a company using the Adjusted Present ValueApproach.

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capstru.xls

This program allows you to estimate an "optimal" Capital

structure for a company using the cost of capital approach.An option in the model also allows you to build in indirect

bankruptcy cost by letting your operating income vary withyour bond rating.

returncalculator.xls Webcast

The return on invested capital and return on equity are

accounting measures but useful measures, nevertheless, ofthe quality of existing projects.

macrodur.xls This program allows you to estimate the duration of a firm'sassets and its sensitivity to other macro economic variables.

It may be useful in the design of debt.

dividends.xls

This program compares the dividends paid to what a firmcould have paid, by estimating the free cash flow to equity

(the cash flow left over after net debt payments, net capitalexpenditures and working capital investments.

dcfval.xls

This program computes the value of equity in a firm using a

two-stage dividend discount and FCFE model. (For moreextensive choices on valuation, look at the programs under

the valuation section below.)

Valuation:Inputs

readme1s.xls This file describes the programs in this section and providessome insights into their usage.

impliedROC&ROE.xls This spreadsheet allows you to compute the ROC or ROE

implied in your terminal value calculation.

wacccalc.xls This spreadsheet allows you to estimate the cost of capital

for your firm.

cpxest.xls This program summarizes the three approaches that can beused to estimate the net capital expenditures for a firm,

when it reaches stable growth.

oplease.xls Webcast

This program converts operating lease expenses into

financing expenses and restates operating income and debtoutstanding.

R&DConv.xls WebcastThis program converts R& D expenses from operating tocapital expenses, estimates a value for the research asset

and restates operating income.

implprem.xls

This spreadsheet calculates the implied risk premium in a

market. This can be used in discounted cashflow valuationto do market neutral valuation.

Valuation

ModelReconciliation

fcfevsddm.xls

This spreadsheet allows you to reconcile the differences

between the FCFE and the dividend discount models forestimating equity value.

fcffvsfcfe.xls This spreadsheet allows you to reconcile the differences

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between the FCFF and the FCFE approaches to valuation.

fcffeva.xls This spreadsheet reconciles a cost of capital DCF valuation

with an EVA valuation of the same company

GrossvsNet.xls

This spreadsheet allows you to reconcile the differences

between the Gross debt and Net debt approaches to

valuation.

All-in-one

Valuation

Models

model.xls This program provides a rough guide to which discounted

cash flow model may be best suited to your firm.

higrowth.xls

This spreadsheet can be used to value tough-to-value firms,

with negative earnings, high growth in revenues and fewcomparables. If you have a dot.com firm, this is your best

choice.

divginzu.xls A complete dividend discount model that can do stablegrowth, 2-stage or 3-stage valuation. This is your best

choice if you are analyzing financial service firms.

fcfeginzu.xls A complete FCFE valuation model that allows you tocapital R&D and deal with options in the context of a

valuation model.

growthbreakdown.xls A model to value the premium you should pay for growth in

either an intrinsic valuation or a relative valuation.

fcffsimpleginzu.xls

A complete FCFF model that allows for changing margins

and has default assumptions built in (to protect you from

inconsistent assumptions). If you want a quick, all-in-onemodel to value a company with relatively few inputs, try

this.

fcffginzu.xlsVideo

Presentation

This model tries to do it all, with all of the associated risks

and rewards. I hate having to work with a dozenspreadsheets to value a firm, and I have tried to put them all

into one spreadsheet - a ratings estimator, an earnings

normalizer, an R&D converter, an operating leaseconverter, a bottom-up beta estimator and industry

averages. Try it out and make your own additions.

fcffginzulambda.xls

This model is very similar to the fcffginzu model, but it

allows the user to enter a measure of company exposure tocountry risk (that is different from beta).

Loose Ends

in Valuation

controlvalue.xls This model analyzes the value of control in a firm.

synergyvaluation.xls This program estimates the value of synergy in a merger.

brandnamevalue.xls

This spreadsheet provides different ways of estimating the

value of a brand name, although each comes with some

baggage.

complscore.xls This spreadsheet allows you to measure the complexity in a

company and give it a score.

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employeeoption.xls This spreadsheet allows you to value employee options and

incorporate them into value.

GrossvsNet.xls

This spreadsheet allows you to understand why the gross

and net debt approaches give you different estimates of

value for a firm.

liqdisc.xls

Estimates the illiquidity discount that should be applied to a

private firm as a function of the firm's size and financial

health. Uses both restricted stock approach and bid-askspread regression.

distress.xls This spreadsheet allows you to estimate the probability of

distress from the bond price of a company.

Focused

Valuation

Modelsddmst.xls

Stable growth, dividend discount model; best suited for

firms growing at the same rate as the economy and paying

residual cash as dividends.

ddm2st.xlsTwo-stage DDM; best suited for firms paying residual cash

in dividends while having moderate growth.

ddm3st.xlsThree-stage DDM; best suited for firms paying residual

cash in dividends, while having high growth.

fcfest.xls

Stable growth, FCFE discount model; best suited for firmsin stable leverage and growing at the same rate as the

economy.

fcfe2st.xlsTwo-stage FCFE discount model; best suited for firms withstable leverage and having moderate growth.

fcfe3st.xlsThree-stage FCFE discount model; best suited for firms

with stable leverage and having high growth.

fcffst.xls

Stable growth FCFF discount model; best suited for firmsgrowing at the same rate as the economy.

fcff2st.xlsTwo-stage FCFF discount model; best suited for firms with

shifting leverage and growing at a moderate rate.

fcff3st.xlsThree-stage FCFF discount model; best suited for firms

with shifting leverage and high growth.

evavaln.xls Three-stage FCFF valuation model, also presented in termsof projected EVA.

fcffgen.xls

A generalised FCFF model, where the operating margins

are allowed to change each year; best suited for firms in

transition.

Financial

Service firms eqexret.xls

Estimates the value of equity in a bank by discounting

expected excess returns to equity investors over time and

adding them to book value of equity.

Troubled

firmsnormearn.xls

Normalizes the earnings for a troubled firm, uising historical

or industry averages.

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distress.xls Estimates the likelihood that a troubled firm will not survive,

based upon bond ratings as well as bond prices.

fcffneg.xls Generalized FCFF model that allows you to value negative

earnings firms as going concerns.

Private firms

pvtdiscrate.xls

Adjusts the discount rate (cost of equity) for a private firm

to reflect the lack of diversification on the part of the owner

(or potential buyer)

minoritydiscount.xls Estimates the discount for a minority stake in a privatebusiness, based on the value of control.

liqdisc.xls

Estimates the illiquidity discount that should be applied to a

private firm as a function of the firm's size and financialhealth. Uses both restricted stock approach and bid-ask

spread regression.

High Growth

Firmsrevgrowth.xls

Estimates compounded revenue growth rate for a firm,

based upon market share and market size assumptions.

higrowth.xls

This spreadsheet can be used to value tough-to-value firms,

with negative earnings, high growth in revenues and few

comparables. If you have a young or start-up firm, this isyour best choice.

Multiples

eqmult.xls

This is a model that uses a two-stage dividend discount

model to estimate the appropriate equity multiples for yourfirm. It will give you identical answers (in terms of value) as

the 2-stage DDM model.

firmmult.xls

This model uses a 2-stage FCFF model to estimate the

appropriate firm value multiples for your firm. It will give

you identical answers (in terms of value) as the 2-stage

FCFF model.

Acquisitionslboval.xls

This program analyzes the value of equity and the firm in a

leveraged buyout.

controlvalue.xls This model analyzes the value of control in a firm.

synergyvaluation.xls This program estimates the value of synergy in a merger.

Other Assetsreval.xls

This spreadsheet allows you to value an income-generating

property as well as just the equity stake in the property.

Value

Enhancement valenh.xls

This spreadsheet allows you to make a quick (and dirty)

estimate of the effect of restructuring a firm in a discounted

cashflow framework.

fcffeva.xls This spreadsheet shows the equivalence of the DCF and

EVA approaches to valuation.

cfroi.xls This spreadsheet allows you to estimate the current CFROI

for a firm.

Basic Option

Pricing bstobin.xls

This spreadsheet converts the standard deviation input in

the Black-Scholes model to up and down movemenents in

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Models the binomial tree.

optst.xls

This is a dividend-adjusted model for valuing short-term

options. It considers the present value of expected

dividends during the option life.

optlt.xls

Tnis is a dividend-adjusted model for valuing long term

options. It considers the expected dividend yield on theunderlying asset.

warrant.xls

This is a model for valuing options that result in dilution of

the underlying stock. Consequently, it is useful in valuingwarrants and management options.

Real Option

Models inCorporate

Finance

expand.xls

This model estimates the value of the option to expand in an

investment project. Modified, it can also be used to assessthe value of strategic options.

delay.xls This model estimates the value of the option to delay an

investment project.

flexval.xls This model estimates the value of financial flexibility, i.e, the

maintenance of excess debt capacity or back-up financing.

abandon.xls This model estimates the value of the option to abandon a

project or investment.

Real Option

Models in

Valuation

equity.xls A model that uses option pricing to value the equity in a

firm; best suited for highly levered firms in trouble.

natres.xls A model that uses option pricing to value a natural resource

company; useful for valuing oil or mining companies.

project.xls

A model that uses option pricing to value a product patent

or option; useful for valuing the patents that a companymight hold.