Concordia University

John Molson School of Business

FINA 410-BB
Winter 2021

1. COURSE INFORMATION
▪ Title: Investment Analysis
▪ Number: FINA 410-BB
▪ Value: 3.0 Credits
▪ Venue: Virtual
▪ Schedule: Monday 5:45pm - 8:15pm
▪ Delivery Method: The primary course delivery method would be pre-recorded video
lectures and Zoom Q&A sessions. Course materials are provided on Moodle. Course
videos are provided on Yuja.

2. INSTRUCTOR INFORMATION
▪ Name: Yu-Jou (Abby) Pai
▪ Title: Assistant Professor of Finance
▪ Email: yujou.pai@concordia.ca
▪ Office Hours: Monday 9:30am-11:30am, or by appointment
▪ Office Location: Virtual via Zoom (Link on Moodle)
▪ Email Response Time: A response will be given within 48 hours except on weekends.

3. PREREQUISITES
FINA 380 or 385; FINA 390 or 395; COMM217

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4. COURSE DESCRIPTION
This course is devoted to investment valuation, both from the viewpoint of the individual
investor and the institutional investor. The major focus of the course will be on equity
valuation. Thereby a holistic valuation process will be discussed starting with basics of
financial reporting and financial statement analysis. Students will learn how to analyze
industries, sectors, and individual companies. Based on that, equity analysis is used to
calculate sound forecasts of future financial statements, which are the key input to a proper
firm valuation. A range of valuation models to determine the intrinsic value of listed firms
will be studied. Students will learn that many aspects of the valuation process are rather
“mechanical.” Students will learn how to use investment tools such as FactSet and
Bloomberg for investment analysis. Students will have to prepare an Industry Analysis and
Stock Recommendation at the end of the course.

The course is supplemented by Excel-based worksheets and numerous practical case studies
guiding students through the forecasting and valuation processes while addressing detailed
computations.

5. COURSE OBJECTIVES
The learning objectives are assessed through homework assignments, problem sets,
interactive course participation, and examinations.
Activity
Learning Objective
Assignments Examinations
Acquire knowledge on the Theory-based, multiple-
interaction between markets Application-based questions choice, and open exam
and macroeconomics questions
Theory-based, multiple-
Acquire knowledge on
Application-based questions choice, and open exam
industry analysis
questions
Acquire detailed knowledge Theory-based, multiple-
on equity and company choice, and open exam
valuation methods: Input Application-based questions questions as well as
parameters, calculation and application-based exam
risk. questions
Acquire detailed knowledge
Theory-based, multiple-
on commodities, commodity
Application-based questions choice, calculus, and open
markets, and investments
exam questions
possibilities
Acquire knowledge on Theory-based, multiple-
investments companies choice, calculus, and open
(Private Equity) and the Application-based questions exam questions as well as
instruments they use for application-based exam
investing questions

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6. REQUIRED MATERIALS
▪ Equipment: The course will be delivered and evaluated entirely online. You should have
access to properly functioning webcam, microphone, and reliable internet connection.

▪ Textbook: Investment Valuation: Tools and Techniques for Determining the Value of
Any Asset 3rd edition by Damodaran. ISBN: 978-1-11813-073-5. E-book is available for
purchase at https://www.wiley.com/WileyCDA/Section/id-832178.html

▪ Bloomberg Market Concept Courses: Use the code ZKNLHVR248 to log in.

▪ FactSet: Please follow the instruction provided on Moodle to register for an account

▪ Video lectures: Weekly video lectures would be uploaded to Yuja on the Sunday before
the scheduled course meeting time. For example, the video lectures for the class on Jan.
18th, 2021 would be made available on Jan. 17th, 2021.

7. OPTIONAL MATERIALS
▪ Textbooks:
o Essentials of Investments 11th edition by Bodie, Kane, and Marcus. ISBN: 978-
126028-839-1.
o Financial Statement Analysis & Valuation 5th edition by Easton, McAnally,
Sommers, and Zhang. ISBN: 978-1-61853-233-6.

▪ Articles:
Lei, A.Y.C. and Li, H. (2012): Using Bloomberg Terminals in a Security Analysis and
Portfolio Management Course, Journal of Economics and Finance Education, Vol. 11 (2),
pp. 17-25.

▪ Zoom sessions:
While video lectures deliver course contents asynchronously, we would do synchronous
Zoom sessions from time to time depending on the class demand. For example, if many
students schedule a Zoom meeting with me to discuss a similar topic, then I would offer a
Zoom session to the whole class to discuss it.

Generally, synchronous Zoom sessions would be scheduled for the designated class
meeting time, i.e., Monday 5:45pm - 8:15pm. I would not collect attendance during
synchronous Zoom sessions. However, each synchronous Zoom session would be
recorded and made available to the class on Yuja, and you are expected to watch the
videos if you could not make it to the synchronous sessions.

▪ Internet resources:
o Dr. Damodaran’s website
http://pages.stern.nyu.edu/~adamodar/New_Home_Page/Inv3ed.htm
o Library Resources
https://www.concordia.ca/library/guides/finance.html

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8. GRADING
The total points to each assignment, exam, and the group project are 100 points. To pass the
course, (1) the average grade of Midterm Exam and Final Exam should be equal to or above
50 points, and (2) a minimum of an overall 50% is required.

For example, if you receive 49 points from Midterm Exam, 49 points from Final Exam, 100
points from Group Project, 100 points from BMC Post-completion assignments, and 100
points from Weekly Homework Assignments, then your overall numerical grade is 69.40%.
However, you will still fail the class because the average grade of Midterm Exam and Final
Exam is 49 points, which is below 50 points.

Your numerical grade will be determined using the weights shown below.
Component Weight
BMC Post Completion Assignments 5% (2.5% each)
Weekly Homework Assignments 10% (1% each)
Group Project 25%
Midterm Exam 30%
Final Exam 30%

The final numerical grade calculated following the above weights will be rounded according
to normal business practice. For example, 84.50% would be rounded to 85%. But 84.49%
would be rounded to 84%.

Your letter grade will be based on the following scale.

Letter Grade Numerical Grade
A+ 90% and up
A 85% – 89%
A- 80% – 84%
B+ 77% – 79%
B 73% – 76%
B- 70% – 72%
C+ 67% – 69%
C 63% – 66%
C- 60% – 62%
D+ 57% – 59%
D 53% – 56%
D- 50% – 52%
F 49% and below
F/DNW Fail/Did not write
NR No record

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9. BLOOMBERG MARKET CONCEPTS (BMC)
You should complete three modules of the self-study course Bloomberg Market Concepts
(BMC) including: Economic Indicators, Currencies, and Equities. The course website is
https://portal.bloombergforeducation.com/courses. The course code is ZKNLHVR248. If
you cannot successfully access BMC with the code, you must notify me before January 31st,
2021.

BMC courses must be completed individually. Please note that due to the COVID19
pandemic, Bloomberg is allowing colleges and universities with existing Bloomberg labs to
offer the BMC course to their students online for free. (In normal time, you would need to
use Bloomberg terminals in the John Dobson Investment Lab to take BMC courses.)

The results directly from the BMC courses will not be graded and should be seen as the
preparation for the BMC post-completion assignments. You are required to finish the
assigned modules and submit two BMC post-completion assignments before due dates. Each
post-completion assignment accounts for 2.5% of your final grade. The due date for each
BMC post-completion assignments is fixed. Please refer to section IMPORTANT DATES
for the due dates.

10. WEEKLY HOMEWORK ASSIGNMENTS:

Students are expected to watch video lectures and attend Zoom meetings in order to meet the
learning objectives for the course. Course participation would be taken through weekly
homework assignments which account for 10% of your final grade.

Weekly homework assignments consist of questions related to course contents delivered in

the video lectures of the corresponding week. Weekly video lectures would be uploaded to
Yuja on the Sunday before the scheduled course meeting time. Students have 7 days to watch
the videos and finish the assignment. For example, the video lectures for the class on January
22nd, 2021 would be made available on January 17th, 2021, and you will have time up to
11:59pm (EST) on January 24th to watch the videos and submit your finished weekly
homework assignment.

Each weekly homework assignments should be submitted on Moodle. If you are going to
miss the due date of a weekly homework assignment because of an unavoidable reason (e.g.,
medical emergency – proper documentation will be required), you must notify me
immediately by e-mail. If you fail to notify me within 24 hours (or in a timely manner if you
are in extreme conditions, e.g., in jail for many days), you will get a score of 0 on it. If you
miss a weekly homework assignment without an unavoidable reason, you will get a score of
0 on it.

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11. EXAM POLICIES
There are two exams (Midterm Exam and Final Exam). The exams are mandatory, and the
schedule is fixed. Please refer to section IMPORTANT DATES for exam dates. If you miss
an exam without an unavoidable reason, you will get a score of 0 on it.

If you are going to miss the Midterm Exam because of an unavoidable reason (e.g., medical
emergency – proper documentation will be required), you must notify me immediately by e-
mail. If you fail to notify me within 24 hours (or in a timely manner if you are in extreme
conditions, e.g., in jail for many days), you will get a score of 0 on the Midterm Exam.

If you are going to miss the Final Exam because of an unavoidable reason, you must notify
me immediately by e-mail. In addition, you will also need to apply for a deferral exam
following the DEF guideline per Concordia policy. If you fail to apply for a deferral exam
and also notify me within 24 hours (or in a timely manner if you are in extreme conditions,
e.g., in jail for many days), you will get a score of 0 on the Final Exam. DEF guideline:
https://www.concordia.ca/students/exams/accommodations/def-note.html

If you anticipate any conflicts (e.g., religious holiday) with exam times, you must notify me
before January 31st, 2021. If you require special accommodation for exams, you have to
provide an official letter before January 31st, 2021. Otherwise, you are expected to take the
exams at the scheduled time.

If it becomes necessary to take an examination at an alternative time, the form of the

examination would be different from the one offered at the scheduled time.

The exams would be conducted online. The online exams would be open-book and would not
be proctored with COLE or Proctorio. Students are allowed to use course textbook, lecture
notes, online search, and Moodle materials during each exam. However, students are not
permitted to communicate with classmates regarding any aspect of the exam or the course
during the exams. Academic integrity is seriously taken.

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12. GROUP PROJECT
A group project should be completed as a part of your grade. The project will involve (Part 1)
an industry analysis and (Part 2) a complete investment and valuation analysis of two
publicly traded companies. The industrial analysis involves the industry that your two firms
are operating in. The two companies you would be analyzing are assigned by me.

There is no make-up assignment for the project: Failure to complete the project will result in
a score of 0 on it. Each group will need to upload a write-up (PDF) and an excel file to
Moodle by the due dates. The due date is shown in the section IMPORTANT DATES. No
credit will be given for late group project submissions. The write-up accounts for 45% of
your group project grade. The excel file accounts for 45% of your group project grade. Please
refer to the Group Project Guideline on Moodle for detailed instructions.

You should first submit a preliminary industry analysis for the project before Midterm Exam.
The due date for the preliminary industry analysis is shown in the section IMPORTANT
DATES. Please refer to the Group Project Guideline on Moodle for detailed instructions. The
preliminary industry analysis accounts for 10% of your group project grade.

13. GROUPS
The project will be completed in groups of 7 to 8 students. I will pick your team. Once
groups are assigned, it is your responsibility to contact your members, arrange meetings, and
conduct within-group communication. You should work on the project with your own group,
not with other groups.

Note that I will not adjudicate any intra-group disputes. Learning to cope with such conflicts
is part of your training. You will have the opportunity to submit confidential evaluations of
your team-mates after the group project is due. Your own group project grade will be
adjusted to reflect the evaluations. In other words, even though the project is completed in
groups, members in the same group would not receive an identical group project grade.

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14. IMPORTANT DATES
Activity Date
DNE Jan. 26th, 2021
Notify me if you
o Have anticipated conflict (e.g., religious holiday)
o Need special accommodation Jan.31st, 2021
o Can’t access Bloomberg Terminal and BMC (11:59pm EST)
o Can’t access FactSet
o Aren’t assigned to a group for the group project
Jan.31st, 2021
BMC Post-Completion Assignment I
(11:59pm EST)
I will inform you of
o Your group members Feb. 07th, 2021
o The two companies you are analyzing
Feb. 21th, 2021
Preliminary industry analysis
(11:59pm EST)
Mar. 14th, 2021
Midterm Exam
(9:00am to 11:00am EST)
Mar. 28th, 2021
BMC Post-Completion Assignment II
(11:59pm EST)
Apr. 25th, 2021
Project Final Report Due
(11:59pm EST)
Final Exam Exact Date and Time TBD

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15. COURSE SCHEDULES
Although the class schedule is tentative and deviations are possible, exam dates and assignment
due dates are fixed. I reserve the right to modify the schedule if needed. Regularly check
Moodle for updates.

Week Date Topics Covered

1 Jan.18th Introduction to the course + Equity Valuation I
2 Jan.25th Equity Valuation II
3 Feb.01st Equity Valuation II
4 Feb.08th Equity Valuation III
5 Feb.15th Library Session + Equity Valuation III
6 Feb.22nd Equity Valuation IV
7 Mar.01st Midterm Break
8 Mar.08th Midterm Exam Review+ Equity Valuation IV
9 Mar.14th Midterm Exam
9 Mar.15th Equity Valuation IV
10 Mar.22nd Equity Valuation V
11 Mar.29th Equity Valuation V
12 Apr.05th University Closed
13 Apr.12th Equity Valuation V
14 Apr.19th Final Exam Review + Equity Valuation V
Class Canceled
14 Apr.21st
(Makeup day for the class on Apr. 05)
TBD Final Exam

16. TOPCIS COVERED

Unless otherwise specified, mandatory readings refer to chapters in the required textbook.

Mandatory Optional
Topic Title
Reading Reading
Macroeconomic and Industry
Equity Valuation I BKM Ch.12
Analysis
EMSZ Ch.2, 3,
Equity Valuation II Financial Accounting Ch.3, 9
4
Equity Valuation III Relative Valuation Ch.2, 17, 18 EMSZ Ch.15
Ch.11, 12, 13, EMSZ Ch.12,
Equity Valuation IV Free Cash Flow and Discount Rates
14, 15 13, 14
Discounted Cash Flow Model and Damodaran
Equity Valuation V Ch.7, 8
Valuation Ch.4

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17. DEFINITIONS OF GRADING

Outstanding. The A+ in the grading system allows for truly

A+
outstanding work to be recognized. Normally achieved by a
A (4.3)
small number of students.
Excellent A Excellent skills and great originality. Superior work in both
(4.0) content and presentation.
Indicates the Excellent. The student has an insightful grasp of the subject
highest level of matter. Academic work demonstrates clear and persuasive
A-
achievement argument. It is a well structured text that features solid
(3.7)
introductory and concluding arguments. There are few
presentation errors.
Very Good performance. Thorough knowledge of concepts
and/or techniques. Student has the ability to learn independently
B+
and to use relevant evidence to develop logically valid
B (3.3)
arguments. Some minor but noticeable errors in presentation
may detract from the otherwise high quality of work.
Good
A good grasp of the subject matter. The student’s paper is clear
B
Indicates a good (3.0) and well structured. Minor components of an answer may be
level of missing.
achievement Good level of knowledge. Has the ability to go beyond the
B-
simple reiteration of the material presented in class. Papers are
(2.7)
articulate and fulfill the course requirements.
Competent. The student’s work is competent and demonstrates
C+ an adequate understanding of the subject matter. Academic
(2.3) work of an acceptable quality. Ideas are presented in a style
C
that is at least coherent and orderly. Presentation errors that
affect the quality of the work are present.
Satisfactory
Fairly competent. Acceptable level of knowledge. Papers need
C
structuring. Student has some difficulty in clarifying his/her
Academic work of an (2.0)
thoughts.
acceptable quality
Satisfactory. Command of only the basic concepts of
C-
knowledge. Student has obvious difficulty structuring and
(1.7)
developing ideas.

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 D+ Marginal performance. Superficial grasp of the subject
D (1.3) matter. A sense of organization and development is often not
Passing demonstrated. Major components of a question may have
been neglected. Difficulty in expressing ideas.
Indicates the D Minimal grasp of the material. Ideas are not clear to the
lowest passing (1.0) reader.
grade D- Deficient in many of the objectives of the course. Important
(0.5) skills not attained.
F
Failure: Basic concepts and principles not learned. Essential
F
Failure skills cannot be demonstrated.

Lack of even
minimal
understanding

18. USE OF ZOOM

Zoom will be used in this course to facilitate learning at a distance. It may be used to record
some or all of the lectures and/or other activities in this course. If you wish to ensure that
your image is not recorded, speak to your instructor as soon as possible.

Also, please note that you may not share recordings of your classes and that the instructor
will only share class recordings for the purpose of course delivery and development. Any
other sharing may be in violation of the law and applicable University policies, and may be
subject to penalties.

Note: Zoom is included as an institutionally-approved technology. This means we have been

assured of the privacy protections needed to use freely within the classroom.

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19. BEHAVIOR
All individuals participating in courses are expected to be professional and constructive
throughout the course, including in their communications.

Concordia students are subject to the Code of Rights and Responsibilities which applies both
when students are physically and virtually engaged in any University activity, including
classes, seminars, meetings, etc. Students engaged in University activities must respect this
Code when engaging with any members of the Concordia community, including faculty,
staff, and students, whether such interactions are verbal or in writing, face to face or
online/virtual. Failing to comply with the Code may result in charges and sanctions, as
outlined in the Code

Link to the Code of Rights and Responsibilities:

https://www.concordia.ca/content/dam/common/docs/policies/official-policies/BD-3.pdf

20. IP
Content belonging to instructors shared in online courses, including, but not limited to, online
lectures, course notes, and video recordings of classes remain the intellectual property of the
faculty member. It may not be distributed, published or broadcast, in whole or in part,

without the express permission of the faculty member. Students are also forbidden to use
their own means of recording any elements of an online class or lecture without express
permission of the instructor. Any unauthorized sharing of course content may constitute a
breach of the Academic Code of Conduct and/or the Code of Rights and Responsibilities. As
specified in the Policy on Intellectual Property, the University does not claim any ownership
of or interest in any student IP. All university members retain copyright over their work.

Link to Academic Code of Conduct:

https://www.concordia.ca/content/dam/common/docs/policies/official-policies/Academic-
Code-Conduct-2015.pdf

Link to Policy on Intellectual Property:

https://www.concordia.ca/content/dam/common/docs/policies/official-policies/VPRGS-9.pdf

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21. EXTRAORDINARY CIRCUMSTANCES
In the event of extraordinary circumstances and pursuant to the Academic Regulations, the
University may modify the delivery, content, structure, forum, location and/or evaluation
scheme. In the event of such extraordinary circumstances, students will be informed of the
changes.

Link to Academic Calendar:

https://www.concordia.ca/academics/undergraduate/calendar/current.html

Link to Academic Regulations:

https://www.concordia.ca/students/regulations.html

22. ACADEMIC INTEGRITY

The most common offense under the Academic Code of Conduct is plagiarism which the
Code defines as “the presentation of the work of another person as one’s own or without
proper acknowledgement.”

This could be material copied word for word from books, journals, internet sites, professor’s
course notes, etc. It could be material that is paraphrased but closely resembles the original
source. It could be the work of a fellow student, for example, an answer on a quiz, data for a
lab report, a paper or assignment completed by another student. It might be a paper
purchased through one of the many available sources. Plagiarism does not refer to words
alone - it can also refer to copying images, graphs, tables, and ideas. “Presentation” is not
limited to written work. It also includes oral presentations, computer assignments and artistic
works. Finally, if you translate the work of another person into French or English and do not
cite the source, this is also plagiarism.

In simple words, do not copy, paraphrase or translate anything from anywhere without saying
where you obtained it!

Link to the Academic Integrity Website:

http://www.concordia.ca/students/academic-integrity.html

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23. ACCESSIBILITY
Instructor will strive to make learning experience as accessible and inclusive as possible. If
you have accessibility needs that require academic accommodations, please meet with an
advisor from the Access Centre for Students with Disabilities (ACSD) as soon as possible to
set up an accommodation plan. I welcome meeting with all students to discuss their
accessibility needs.

Link to ACSD: https://www.concordia.ca/students/accessibility.html

24. USE OF THIRD-PARTY SOFTWARE &WEB SITES

If you are using third-party software and/or web site, see the guidelines and include a
statement. Information and standard wording found here in the link below.

Link to technology guideline

https://www.concordia.ca/ctl/technology-guidelines.html

25. TERRITORIAL ACKNOWLEDGEMENT

I/We would like to begin by acknowledging that Concordia University is located on unceded
Indigenous lands. The Kanien’kehá:ka Nation is recognized as the custodians of the lands
and waters on which we gather today. Tiohtià:ke/Montréal is historically known as a
gathering place for many First Nations. Today, it is home to a diverse population of
Indigenous and other peoples. We respect the continued connections with the past, present
and future in our ongoing relationships with Indigenous and other peoples within the
Montreal community.

Link to more information on territorial acknowledgement:

https://www.concordia.ca/about/indigenous/territorial-acknowledgement.html

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26. LIST OF STUDENT SERVICES
1. Access Centre for Students with Disabilities
https://www.concordia.ca/students/accessibility.html
2. Student Success Centre
https://www.concordia.ca/students/success.html
3. Counselling and Psychological Services
http://www.concordia.ca/students/counselling-life-skills
4. Concordia Library Citation and Style Guides
https://library.concordia.ca/help/citing
5. Health Services
http://www.concordia.ca/students/health
6. Financial Aid and Awards
http://www.concordia.ca/offices/faao
7. Academic Integrity
http://www.concordia.ca/students/academic-integrity
8. Dean of Students Office
http://www.concordia.ca/offices/dean-students
9. International Students Office
http://www.concordia.ca/students/international
10. Student Hub
http://www.concordia.ca/students
11. Sexual Assault Resource Centre
http://www.concordia.ca/students/sexual-assault
12. As a Concordia student, you are a member of the Concordia Student Union and have
many resources available to you including:
a. HOJO (Off Campus Housing and Job Bank)
https://www.csu.qc.ca/services/hojo/
b. CSU Advocacy Centre
https://www.csu.qc.ca/services/advocacy/
12. Aboriginal Student Resource Centre
http://www.concordia.ca/students/aboriginal

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