English   Danish

2017/2018  KAN-CCMVV2005U  Valuation

English Title

Course information

Language English
Course ECTS 7.5 ECTS
Type Elective
Level Full Degree Master
Duration One Semester
Start time of the course Autumn
Timetable Course schedule will be posted at calendar.cbs.dk
Max. participants 80
Study board
Study Board for MSc in Economics and Business Administration
Course coordinator
  • Peter Ove Christensen - Department of Finance (FI)
Further information: https:/​/​studentcbs.sharepoint.com/​CEMS/​Pages/​Valgfag-paa-CBS_DK.aspx
Main academic disciplines
  • Finance
  • Accounting
  • Economics
Last updated on 22-02-2017

Relevant links

Learning objectives
To achieve the grade 12, students should meet the following learning objectives with no or only minor mistakes or errors:
  • Describe a complete valuation of a listed company in a written project report including a historical financial analysis of the company`s annual reports, a strategic analysis of the company and a DCF- or RI-analysis to complete the valuation.
  • Formulate and apply classical DCF- and RI-analysis including estimation of the model parameters, and reflect on the assumptions behind the two models with a critical view.
  • Apply at least one other approach to the valuation, such as the use of multiples and peer groups for the company which is valuated, and/or a real option valuation, and/or an abnormal earnings growth approach.
  • Evaluate the results of the valuation in the project report at the oral examination including the literature used in the course.
Course prerequisites
MSc.EBA area progression course: AEF, FIR, FIN, FSM & ASC
Participants are required to have completed the MSc EBA course Corporate Finance or the ASC course Risk Mangement & Corporate Finance.
Exam ECTS 7,5
Examination form Oral exam based on written product

In order to participate in the oral exam, the written product must be handed in before the oral exam; by the set deadline. The grade is based on an overall assessment of the written product and the individual oral performance.
Individual or group exam Oral group exam based on written group product
Number of people in the group 4-5
Size of written product Max. 40 pages
Oral exam is in group with 15 minutes pr. student though max. one hour. total pr. group.

Students who wish to have an individual exam might be able to write a term paper in the course. Please see the cand.merc. rules for term papers for more information.
Assignment type Project
Written product to be submitted on specified date and time.
15 min. per student, including examiners' discussion of grade, and informing plus explaining the grade
Preparation time No preparation
Grading scale 7-step scale
Examiner(s) Internal examiner and second internal examiner
Exam period Winter
Make-up exam/re-exam
Same examination form as the ordinary exam
Re-take exam is to be based on the same report as the ordinary exam:

* if a student is absent from the oral exam due to documented illness but has handed in the written group product she/he does not have to submit a new product for the re-take.

* if a whole group fails the oral exam they must hand in a revised product for the re-take

* if one student in the group fails the oral exam the course coordinator chooses whether the student will have the oral exam on the basis of the same product or if he/she has to hand in a revised product for the re- take.
Course content and structure

In Valuation you get to apply everything you have learned in your study of economics and business administration. Only your imagination sets the limits. In valuing a stock or a company you need to have an idea of the firm's current assets and liabilities and its ability to create value in the future. In order to avoid pure speculation, you will first acquire a thorough knowledge of the firm's business and its markets, and you will perform a historical financial statement analysis in which you will focus your reformulations on historical value creation. You will try to identify the key sensitivities to general and industry specific factors for comparing historical performance to past economic conditions: what are the persistent and what are the transitory factors? A thorough strategic analysis of the firm and its markets is the next step. Combining this knowledge with statistical tools allows you to make forecasts of future value creation, and you can do this as complicated as you want. Converting these forecasts into a value of the firm today requires discounting both for time and for risk, and discounting may not be as simple as you think.


We will first go through the standard approaches to corporate valuation as they are used in practice. You and your partners will start early on analyzing a specific company, which will eventually lead to your final report. The second part of the course takes you through some new approaches to valuation and, in particular, how to discount for time and for risk. You may want to include some of these new approaches in your report, or you may use this knowledge for critically assessing the problems in the standard approaches.


The course combines the participants’ prior knowledge of finance and investment theory, financial statement analysis and corporate strategy and is therefore primarily suited for masters students in the final part of their study program. The students have to write a project report on the valuation of preferably a listed company in groups of 4--5 students. This report must be handed in before Christmas,and it will be the basis for the oral exam in January.

Teaching methods
Lectures and student presentations. The first 11 weeks of the course are joint lectures with discussion of the literature and some cases with active student participation. The students will throughout the semester work on the project report in groups of 4--5 students on a self-selected company, preferably a listed Danish or foreign company. Students should be prepared to put a considerable personal effort in the project report, and part of the literature is for self-study.
Feedback during the teaching period
Office hours and Q&A sessions in connection with lectures, in particular, with regards to the students' work with their project.
Student workload
Teaching 33 hours
Preparation 43 hours
Project 100 hours
Exam 30 hours
Expected literature

Christensen, P. O., and G. A. Feltham. 2009. Equity Valuation, Foundations and Trends in Accounting 4, 1--112.


Nissim, D., and S. H. Penman. 2001. Ratio Analysis and Equity Valuation: From Research to Practice, Review of Accounting Studies 6, 109--154.


Penman, S. H.: Financial Statement Analysis and Security Valuation, McGraw-Hill, latest edition.


A collection of supplementary articles and notes will be handed out as the course proceeds.

Last updated on 22-02-2017