The Scheller College of Business at Georgia Tech has launched a Stock Valuation Research Portal, a student-led project aimed at valuing major publicly traded companies. Leveraging advanced financial methodologies, the project employs Discounted Cash Flow (DCF) analysis to estimate the intrinsic value of key players in the transportation sector and beyond.
Georgia Tech student researchers applied advanced modeling methods to gauge the fiscal stability and growth potential of selected firms. Their work aggregates a minimum of five years of historical financial data for each company into a unified spreadsheet, encompassing metrics such as revenue, profits, balance sheets, and cash flows. Projections for future cash flows and earnings are then used to estimate the stock value at the end of the fifth year. The anticipated stock prices and dividends are subsequently adjusted to their present worth, offering a detailed evaluation of the true value of each company.
Employing this approach not only serves as a sophisticated tool for long-term investment valuation but also equips the students with a practical understanding of equity investment analysis, the significance of capital allocation, and sound financial decision-making. The initiative underscores Georgia Tech and Scheller’s commitment to preparing interested students from all disciplines in financial analysis techniques.
Michael Messner, Professor of the Practice, leads the project through his Equity Research Boutique course, offered each fall and spring semester. The course is a part of Georgia Tech’s Vertically Integrated Projects (VIP) program, which engages undergraduate and graduate students in ambitious, long-term, large-scale, and multidisciplinary project teams that are led by faculty.
"Our goal is to provide investors and industry stakeholders with useful equity analysis and supply practical tools for students using real world examples,” explains Messner. “We hope to offer a nuanced perspective on the intrinsic value of major companies. This type of work stands as a testament to Tech’s commitment to advancing knowledge that drives positive change in the global economy.”
The website has a unique feature allowing each user to modify assumptions for projected revenue growth, operating margin and terminal price-earnings ratio. The intrinsic value is then re-calculated based on the user’s own inputs. In addition, a sensitivity analysis can be performed to determine assumptions built into the current stock price. While the web site was initially developed for transportation stocks, it has become a tool that can be applied to general stock research.
Continuous input from investors, stakeholders, and corporate entities on the data and findings presented within the Stock Valuation Research Portal is welcomed and encouraged. This collaborative approach ensures the portal remains a dynamic and evolving resource.
For media inquiries or further information, please contact stockvaluationresearch@gatech.edu.
Visit: Stock Valuation Research Portal
The Equity Research Boutique, Machine Learning for Financial Markets, and Natural Language Processing for Financial Markets are VIP projects sponsored by the Financial Services Innovation Lab. These projects combine the best of fundamental and quantitative approaches to finance.
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