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Happy Wednesday, future bankers!

Hope everyone is doing well! Today we’re covering which valuation methodology outputs the highest valuation, a time you set a goal, and the latest on Disney’s proxy fight.

🚀 Let’s get into it.

🔢 Technical Question

Among discounted cash flow (DCF), comparable company analysis (comps), and precedent transactions, which method typically results in a higher valuation?

In the context of investment banking, the valuation method that typically results in a higher valuation is the Precedent Transactions methodology. This is because when companies are purchased, the target’s shareholders are typically paid a price that is higher than the target’s current stock price. Therefore, the multiples derived from transaction comps (and the implied valuations) tend to be the highest when compared to the valuations derived from trading comps or standalone DCF valuations.

🗣 Behavioral Question

Tell me about a time that you set a goal.

When responding to the question “Tell me about a time that you set a goal” in an investment banking internship interview, consider the following best practices:

1. Use the STAR Method: This stands for Situation, Task, Action, Result. Begin by describing the situation and your specific task or responsibility. Then, detail the actions you took and the results that followed.

2. Be Specific: Provide a specific example from your past experiences. This could be from a previous job, a school project, or any other relevant experience. The more specific you are, the more convincing your story will be.

3. Focus on Your Role: Highlight your individual contribution and how you drove the process towards achieving the goal.

4. Showcase Relevant Skills: Choose a story that showcases the skills relevant to the role you’re applying for. For an investment banking internship, this could be analytical skills, problem-solving, or teamwork.

5. Discuss the Outcome: Discuss the outcome and how it helped you grow professionally. If the outcome was not as expected, focus on what you learned from the experience and how you would apply these learnings in the future.

Remember, the interviewer is interested in understanding your goal-setting process, your action plan, and how you handle challenges along the way. So, make sure your story covers all these aspects.

🗞 Industry News

🏆 Disney Wins Ugly Proxy Fight

Disney has emerged victorious in a heated proxy battle against activist investor Nelson Peltz, maintaining the current board structure. This victory, announced at Disney’s annual shareholder meeting, was backed by about 75% of retail shareholders. The win brings an end to months of uncertainty for Disney and its CEO, Bob Iger. However, it also means the board will face increased pressure to deliver results as the company navigates the shift from traditional cable to streaming services.

In addition to thwarting Peltz’s bid for board seats, Disney also defeated activist Blackwells Capital, who had proposed adding three nominees to the board. Despite the victory, Disney’s stock traded lower following the announcement. The company had received support from high-profile entities like proxy firm Glass Lewis and notable individuals such as JPMorgan CEO Jamie Dimon and “Star Wars” creator George Lucas. Prior to the vote, Peltz had secured backing from influential shareholders, including the California Public Employees’ Retirement System (CalPERS), the country’s largest public pension fund. Despite the outcome, Peltz vowed to keep a close eye on Disney’s performance.

Read more about this story below.

Thanks for tuning in today! Best of luck to everyone working through recruiting right now. If you sign an offer, reply to this email and let us know about it! Like seriously, do it—we’d love to hear about it!