Might there be someone who knows a specific esoteric Excel function better than us? Perhaps.Are there better VBA programmers out there? Certainly.
Is there someone who's better than us in Excel overall? Slim chance, the same way Santa Claus might actually exist.
But when it comes to using Excel to quantify business decisions, no one else comes close.
We are the best at that – we know it, and our clients know it.
To empower market participants to make better informed decisions via independent, analytical and critical thinking skills.
We support this with a unique approach made possible by our extensive industry experience and laser sharp focus on standardizing best practices.
Most training firms focus on one side of the industry but not the other, like debt (credit) vs. equity, or fundamental vs. quantitative analysis.
We combine all facets, as capital structure is the crux of all financial analysis – beyond that, free market forces take over.
That means our programs elevate you above your peers by drawing from other perspectives in finance — usually the opposing ones.
Here are some examples of how we set you up for success, where other training providers lead you to failure:
Often, they think they got the right exit multiple, but they're wrong and don't even know it.
The result? Their returns rarely end up as high as their initial analysis, even if every single projection driver was correct.
Determing the correct IRR from the beginning can go a long way. We focus heavily on this in all our LBO training.
It's quite simple: because they honed transferable skills.
Participants in any competent training class will build excellent analytical skills and Excel skills – but that alone won't give you operational, boots-on-the-ground decisions.
In our advisory services and advanced training programs, we consider your specific market position and role. That leads to picking the right metrics and tangible goals.
The truth is that many talented financial analysts in the credit space have spent most of their career on the same types of projects, and they've gotten quite good at what they do.
However, from the very start, they weren't exposed to the ground-level nuances of credit agreements. They never got knee-deep into the weeds, so to speak.
Without that foundation, it's a tremendous challenge to transition into buy-side credit, because many of the terms and arrangements are unlike anything they've seen before.
That's why we strongly emphasize the core elements of credit agreements in our credit training programs – demystifying the legalese and examining debt structures one clause at a time.
Good financial analysis comes from independent thinking and connecting disparate pieces of information.
Can you compete with some of Wall Street's sharpest minds?
Take 3 minutes and see if you can beat out the vast majority who get this channel check wrong:
1. What is their biggest driver of revenue growth?
Consider the supply chain. Suppose Toyota posts a surge in sales; is that good or bad for Goodyear?
Next step: Identify who supplies their tires – this is a vertical integration channel check.
Next step: Identify the tire manufacturer who offers the most attractive commissions for tire shops.
2. What about their Cost of Goods Sold (COGS)?
Revenue growth recently fluctuated from negative 15% to positive 20%: good or bad? It depends: why the change?
Synthetic rubber (oil-based product) and steel are GT's largest inputs. Both are very volatile and variable costs.
Meanwhile, GT has maintained constant gross margins: COGS as a % of revenue is steady at about 82%.
Take note: Goodyear does not hedge commodity price risk.
3. What is the source of their revenue growth?
GT passes along input price increases to their clients per the MD&A and as witnessed by fairly constant margins.
From the footnotes, we quantify that in 2011, price increases accounted for over 100% of revenue growth, while volume shipments were flat to negative.
Conclusion: The primary drivers of GT's revenue growth are commodity prices of rubber (oil) and steel!
Investing in (or lending to) GT is less of an ancillary auto industry play, and more of a commodities price play!
4. Well... what drives these commodity prices?
At the time (2013), China was the #2 oil consumer worldwide (33%) and largest steel consumer (47%).
The post-credit crisis boom in commodities prices are largely due to China's infrastructure development.
As China's economy slows down, so do commodities prices – as witnessed in late 2014 with WTI dropping 40%.
Final Thesis: China is the most impactful long term driver of Goodyear's revenue and profits!
These counter-intuitive findings can only be discovered with critical thinking and an eye for analyzing financial statements. You'd be surprised at how many industry veterans completely missed this.
Want to learn how to come up with insights like this on your own? Take one of our training courses today.
Want your firm to avoid these pitfalls? Take one of our training courses today.Explore WST
No boring one-way lectures
No rote memorization
Not too hard nor too easy
Each of our in-class case study companies was chosen because they involve some unique nuance.
We don't just reference "easy" or made-up companies that lack the complexities of real-world financial analysis.
If someone finishes our training, but starts a deal on the job with a "deer in headlights" look... that means we've failed.
We teach by asking the right leading questions at the right time. This way, the knowledge actually sticks!
Last, but not least, our training wouldn't be possible without our team of expert instructors.
Select one to read more about their background:
For more details about WST, including our history and further case studies:View Overview PDF