friday, feb 7 2014 weekly meeting investment club
TRANSCRIPT
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FRIDAY, FEB 7 2014WEEKLY MEETING
INVESTMENT CLUB
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PREVIEW
1. Market Update
2. Club Overview
3. Interview Tips
4. Stock Fundamentals
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Market Update
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Expedia Earnings
Reported earnings – Earnings beat estimatesStock appreciated 13% after hoursWas down 4.3% due to search-engine
concernsDifficult to separate from competitorsClub has enjoyed 30% gains
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Long-Term Jobless Benefits Rejected
Republicans blocked 3 month extension
Could hurt consumer confidence
Discourages workers to continue job search
Issue could be revived depending on debt limit
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Market Volatility
The S&P 500 appreciated 30% - 2013Investors estimate between 8-10% for 2014Reduce positions in U.S. small company
stocksBlue chip stocks / short – term bondsTech giants Apple and Cisco highlighted
Established infrastructure Pay dividends
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Improved Labor Market
Fed officials concerned with fast falling unemployment
Contradicts Okun’s LawBy U6 measure, unemployment was 13.1%When should Fed raise rates?
Too quickly: dampen economic recovery Too slow: fuels inflation, financial bubbles
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Global Economy
Continued pessimism for economic recoverySentiment based upon:
Tumbling stock prices Fed’s taper of QE Weak U.S. reports in car sales, home sales, hiring Emerging Markets: Brazil growth down 5% since 2011 Concerns in Chinese growth (2nd largest economy)
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CLUB OVERVIEW
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Investment Club
OVERVIEW: 1. Close to $500,000
2. Over 40 stocks
3. Strictly Student Run
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GOALS
1. Manage and Grow Portfolio
2. Educate Members
3. Network
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WHY INVESTMENT CLUB?
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New Ideas
1. Shareholder Meeting
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Ideas
2. Freshman Investing Crash Course
3. Wall Street Panel
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Ideas
4. Stock Pitch Battle
5. WSJ Quiz
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Ideas
6. Mentorship Program
7. Interview Prep
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INTEVIEW PREP
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INTERVIEW PREP
NETWORKING, NETWORING, NETWORKING
WHAT YOU NEED:
*** STRONG GPA *** UNDERSTANDING OF MARKETS *** DESIRE TO LEARN
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Wall Street Interview
COURSE WORK: - Financial Accounting, Financial Theory, Corporate Finance, ect.
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COMMON QUESTIONS
FIT QUESTIONS:
1. How did you prepare for this interview?
- Coursework, WSJ, Barrons, ect.
2. Describe a moment when you worked under pressure?
- Time crunch, stick to basics
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Banking Questions
1. What is the main goal of an investment bank? - Get company from point A to B
2. Briefly tell me about recent major financial transactions? 3. Explain Structure of XYZ Bank? - Read 10K
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Questions
4. Most important trends in economy?
5. Do you follow a certain stock?
6. Role of a summer intern/ full time analyst?
7. Why XYZ Bank? - CEO: Direction of firm
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FINANCIAL QUETIONS
1. How does Net Income influence all 3 financial statements?- Income Statement, Balance Sheet, Cash Flow
2. Basic Methods for Valuing a Company?- Comparable Analysis- Precedent Transaction Analysis- DCF
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BRAIN TEASERS
Q: You’ve got a 10 x 10 x 10 cube made up of 1 x 1 x 1 smaller cubes. The outside of the larger cube is completely painted red. On how many of the smaller cubes is there any red paint?
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BRAIN TEASER
A: First, note that the larger cube is made up of 1000 smaller cubes. The easiest way to think about this is how many cubes are NOT painted? 8 x 8 x 8 inner cubes are not painted which equals 512 cubes. Therefore, 1000 – 512 = 488 cubes that have some paint. Alternatively, we can calculate this by saying that two 10 x 10 sides are painted (200) plus two 10 x 8 sides (160) plus two 8 x 8 sides (128). 200 + 160 + 128 = 488.
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RESOURCES
1. FINANCIAL NEWS OUTLET
2. MACABACUS. COM
3. WALLSTREETOASIS.COM
4. GLASSDOOR.COM
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Qualitative Analysis of Tesla (TSLA)
BY BRENDAN GOVER
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Common Qualitative Measures
Dan Killmurray ’85 (UBS)
TAM
Moat
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Management
Management track record/compensation package
Elon Musk
Previous/current other business ventures
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COMMENTS?
How can the club improve?
Suggestions?