Book Image

Hands-On Financial Modeling with Excel for Microsoft 365 - Second Edition

By : Shmuel Oluwa
Book Image

Hands-On Financial Modeling with Excel for Microsoft 365 - Second Edition

By: Shmuel Oluwa

Overview of this book

Financial modeling is a core skill required by anyone who wants to build a career in finance. Hands-On Financial Modeling with Excel for Microsoft 365 explores financial modeling terminologies with the help of Excel. Starting with the key concepts of Excel, such as formulas and functions, this updated second edition will help you to learn all about referencing frameworks and other advanced components for building financial models. As you proceed, you'll explore the advantages of Power Query, learn how to prepare a 3-statement model, inspect your financial projects, build assumptions, and analyze historical data to develop data-driven models and functional growth drivers. Next, you'll learn how to deal with iterations and provide graphical representations of ratios, before covering best practices for effective model testing. Later, you'll discover how to build a model to extract a statement of comprehensive income and financial position, and understand capital budgeting with the help of end-to-end case studies. By the end of this financial modeling Excel book, you'll have examined data from various use cases and have developed the skills you need to build financial models to extract the information required to make informed business decisions.
Table of Contents (19 chapters)
1
Part 1 – Financial Modeling Overview
4
Part 2 – The Use of Excel Features and Functions for Financial Modeling
8
Part 3 – Building an Integrated 3-Statement Financial Model with Valuation by DCF
15
Part 4 – Case Study

Interpreting the results

A summary of the results is shown in the following figure:

Figure 10.11 – Summary of valuation results

These results can be displayed in graphical form in what is referred to as a "football field." It gets its name from the way the different valuations are scattered around the chart like football players. To do this, we start by expanding our previous table, as follows:

Figure 10.12 – Data for chart

Highlight the table and select Insert | 2-D Bar | Stacked Bar. The following figure shows how to select the chart from the ribbon:

Figure 10.13 – Selecting 2D stacked bar chart

A 2D stacked bar chart is created from the information in the table selected, as shown in the following figure:

Figure 10.14 – 2D stacked bar chart

We will need to make a number of formatting changes to the chart:

  1. First of all, we will select Switch...