Michael R King COM445 4 Apple Valuation Project

Introduces the Apple Inc. valuation project for my course on Corporate Finance and Valuation. (Note: The video combines an updated introduction from April 2021 with the original video from May 2020). In this project, students learn to build a discounted cash flow (DCF) model in 4 parts: 1. Download financials into Excel and calculate common-size financial statements and financial ratios 2. Generate a 5-year pro forma forecast of sales and the inputs to Free Cash Flow to the Firm = EBIT x (1-tax) + Depreciation - CAPEX - Change in Net Working Capital 3. Estimate Apple's weigthed average cost of capital (WACC) 4. Discount the forecasted FCFF and terminal value using the WACC to get the Enterprise Value, then back out the price per share The video illustrates these steps using data from the internet and Excel.