So essentially the DTA is just the accumulation of the benefits and losses of NOLs? Meaning that if we have NOLs of 275 Then 275*.4=110 and the fire out DTA for that would be 110. So in your example where we have 120 of taxable income that next year, we would just subtract 110 from it because we have that benefit. However, if we would have more then we only subtract the amount that we need to make it 0.

Hey, I have biws platinum but I do not see this template

Are there any prerequisite courses that you can recommend to me before understanding this one? I am particularly lost why there's a beginning and ending assets and how come change in provision in income statement affects the balance sheet. Should I just look at it as two consecutive quarters' financial statements? Or banks update their financial statements before publicly releasing them?

hey i have a question, how does a company that is raising a billion dollars in IPO going to pay back 940 million in commisions for the IPO process itself, doesn't that go against the whole purpose. The net proceeds from that whole fund raising process would be 60 million.

Excellent 👌🏻, thanks for providing such a great content on this topic, do you have time to please make a video on financial analysis for a credit analyst?

Something that doesn't make sense to me is the total price of acquisition of the asset (in this case the house). We are assuming that total acquisition cost is $500, so: Scenario 1-> I use $500 cash or equity and buy the house; Scenario 2-> $150 cash and $350 debt. So this would be total acquisition cost EXCLUDING interest rate. But since I am borrowing money we should include interest rate ON TOP of the $350. Therefore total acquisition cost in Scenario 2 should be higher than in Scenario 1, based on how much the interest rate is. Am I missing something?

Brian, thank you for all your content. So far, you have the most informative and deepest level of finance tutorial on KZbin. Pls continue spreading your knowledge and god bless you and your platform. More power to you in 2025!

Thanks. For problems like this in IB interviews / and for more complex extensions, can we use paper? Or should we do this all in our head?

Thank you so much homie. I've done it along with you, it helped me so much. God bless you!

Awesome video. Thank you

Brian, thank you so much for the tutorials. As you may know, Blackstone has shifted its focus toward the private credit market. It would be fantastic if you could create a video introducing this segment of their business and discussing its significance, as it appears to be a hot spot in the market and is likely to trend further in the future.

Excelent video. One question, how would you do the sizing if you add cash sweep (let's say, 50%)?

Very helpful, good presentation!

Very helpful!

Love the title lol

Gridlines - Bruh...I use the focus cell feature, but to each their own. Otherwise, this is pretty damned awesome.

Thanks for the tutorial! I have a question - why was the cash flow statement projected independently instead of derived through the balance sheet projections? Is that approach valid as well?

Great video and files!

Really enjoyed this one!

Great analysis

Happy Thanksgiving! I'm working through all your long form guides through the break

Cyber Week Sale: breakingintowallstreet.com/breaking-into-wall-street-courses/ Files & Resources: breakingintowallstreet.com/kb/leveraged-buyouts-and-lbo-models/convertible-preferred-stock/ Table of Contents: 0:00 Introduction 1:16 Table of Contents 1:29 Part 1: The 3-Minute Summary 4:00 Part 2: Assumptions & Model Flow 7:01 Part 3: Exit Calculations 11:27 Part 4: Avoiding the Circular References 14:52 Recap and Summary

A question: when doing the LBO model, what assumptions do you make on the debt you raise? How do you decide how much Senior vs less senior debt?

Hi, one question: how does the increase in debt get reflected on the cashflow from financing? Usually, you take the difference in total debt to reflect any changes, but then we would be double-counting the cash effect of the PIK, if we just added it to the debt increase in the financing part? So the correct way would be to only consider other changes in debt without PIK on the cashflow from financing?

Do you include operating leases in the Debt/Total Cap and Debt/Equity calculations? When you discount UFCF using WACC, when do you / do you not include operating leases when working from EV to Equity value to get to share price? I know operating leases have their own discount rates (either explicit or calculated) used to calculate the operating lease liabilities, but also know that you need to exclude operating leases from EV when using EV/EBITDA multiples.

What about implementation fees

Files & Resources: breakingintowallstreet.com/kb/venture-capital/liquidation-preference/ Table of Contents: 0:00 Introduction 1:25 Part 1: Simple 1x Liquidation Preference Example 4:17 Part 2: What Makes Liquidation Preferences Tricky? 9:13 Part 3: Pari Passu Liquidation Preferences 12:43 Part 4: The Liquidation Preference Waterfall 14:47 Recap and Summary

Hi Brian, useful video as always. Any chance you could make a video on building a DCF from scratch? I have a lot a lot of questions, like how to figure out the percentage for Revenue, Capex, or Change in NWC from historical data, or even D&A. Thank you so much !!!

thanks for the video! I think the retention rate row can be adjusted? Instead of divided by the sum of # Existing Customers and # New Customers, it should rather be divided by (the sum of # Existing Customers and # New Customers) - Churn last year? Because SUM(# Existing Customers and # New Customers) is not equal to the total number of customer last year?

Could anyone help me with a problem? I am trying to do a case study for a TMT company that reports OIBDA instead of EBITDA. 2 questions, should i conbert OIBDA into EBITDA for DCF valuation, if yes, how so and 2nd how do I compare this company with its 3 competitors who all report EBITDA. Also, can anyone share a template of investment thesis for making an investment decision in debt and/or equity of this TMT company.

Would you mind explaining your response to common questions on the topic 4:24, specifically: "the taxable income for book purposes is lower than it is for tax purposes, doesn't that create a DTA instead", and also when we would know the difference between switching between the two methods of thinking about DTAs/DTLs? In your video "Deferred Taxes in Models and Valuations: Interpretation and Projections", we learn that if a company has accelerated depreciation on tax books, that leads to lower pre-tax income, therefore we pay less in cash taxes than the books, creating a DTL. I think of that as "since we paid less to the IRS than we 'should have' that creates a DTL." But, in this video we pay more to the IRS than on the books, and yet we still have a DTL. I understand that the write-up of PP&E and intangibles isn't tax deductible in stock sales/338(h)(10) and since we have additional D&A on GAAP that isn't recognized by the IRS, we owe more in taxes. But it's the switching of the concept that confuses me. In the first scenario, paying less in cash taxes than book taxes creates a DTL. In the second, paying more in cash taxes than the book also creates a DTL. Also, if we're working on a company's financials, say from the IB/PE perspective, and the company has DTLs created from accelerated depreciation in the past and also a DTL created from an acquisition today, how can we think about them concurrently - since cash taxes being greater than book taxes either could or couldn't create a DTL? Thanks, and it would be really helpful to hear your thoughts on this.

I am a beginner. Is there any watch order in this playlist or any other playlist where I could learn LBO from scratch.. pls tell

Thank you

Hi, thank you very much for this tutorial! I have a question: I'm given 2 days (weekend) to create an investment PowerPoint for a infra (greenfield) MMPE shop. Would the process be similar to what you showed in this video (except usung proejct finance model instead of LBO)?

Hi Brian, I have a question about the structure you mentioned. Is this framework applicable to all companies, or is it specific to the one you're currently working with? Also, could there be variations in the three-statement model? I've noticed that some companies have categories that don't align with the 10-K structure you're using. I’d appreciate your insights, thank you so much!

How will this change if we put a rule for a management option pool that the management would get that only if the IRR in the deal exceeds 25%?

Do we need to include the interests we pay on operating « legit » leases in the cost of debt to calculate the WACC ?

how about PEG ratio? what is your opinion on it?

Hi - Thank you for the in depth review. I am london based hence work mostly with IFRS/pre IFRS. My question is based around Football field and valuation using DCF vs LBO (using pre IFRS guidelines). Under the LBO, we would mostly deduct the leases principal in the CF statement every year and the interest in the NI which will get a tax-saving effect. When doing a DCf, we would adjust for the leases in the EV but will not account for the tax-saving effect. Should we adjust this in the LBO cash flow statment? I might have misunderstood so please let me know if this is not the correct way to approach this question.

You are amazing

Hi Brian, This was a very informative video, thank you. One question on the method of calculation in Part 1. With respect to calculating the equity to management options, would it be more accurate to use the same formula but instead of linking to 20%, calculate 20%/(1+20%) to reflect a lower management ownership following dilutions, and then multiply that by (Exit Equity Proceeds + Cash from Management Options) instead of just to Exit Equity Proceeds. I think I've seen it done like this before and this might be capturing what you're doing in part 3. Sure it won't make a material difference in most cases, but wanted to hear your thoughts on whether this is a reasonable approach In addition, could you further explain the part where you mentioned in Part 2 that management IRR is higher than sponsor IRR if there is rollover + option due to receiving "discounted equity"? I would've thought the higher IRR comes from exercise (and thus fronting the payment) of those options upon sale instead of at Year 0 like the sponsor. The valuation they're entering in at is also at the initial equity value (and not exit equity value) so not sure if that's what you were trying to reference with that comment Many thanks, Vincent

Thank's Brian.

Files & Resources: breakingintowallstreet.com/kb/leveraged-buyouts-and-lbo-models/management-rollover-vs-management-option-pool/ Table of Contents: 0:00 Introduction 1:13 Part 1: The 3-Minute Summary 4:58 Part 2: Rollover vs. Option Pool IRR 6:42 Part 3: Share/Option Counts for These Structures 13:03 Part 4: Does the More Complex Method Matter? 14:10 Recap and Summary

Great share!!

what is the best way to model for existing customers as i forecast new bookings? we typically receive cash upon booking so for new customers, new bookings = cash receipts but for existing customers, what do you suggest?

Thanks for the video! I haven't quite understood the difference between NWC and WC yet. Is it correct to say that WC = CA - CL and NWC = Current Operating Assets - Current Operating Liabilites?

hi! this is a great video that has definitely improved my understand of DCF! thanks! I wanna know why do you use the historical average to get the effective tax rate instead of using the current corporate tax rate? thank you

Really Enjoyed the Crisp summary on Multiples. Can you suggest any Books that explains Valuation Multiples on a deeper level from an Equity research/ Investment Banking POV ? Thanks.

Thank you, sir!

You are a legend. Your content is really the best!!