with Mastercard's
Director of Finance
for North America
10 AUG 2021 - 23 SEP 2021
Duration:
7 WEEKS
TUESDAYS & THURSDAYS
5 PM PST / 8 PM EST
Mastercard's Director of Finance for North American markets wants to teach you how to leverage the fundamentals of corporate finance to advance your business interests — and your career.
Understanding how to create and measure value is a central skill for anyone wanting their business projects or investments to thrive. Jennifer Clarke brings simplicity to complex financial metrics through real-world business cases, practice labs, and mock analyses.
Demystify corporate finance
Enhance your career with the financial expertise to confidently plan and execute budgets for projects, departments, or for participating in decision making on a senior level.
MasterCard Director of Finance Jennifer Clarke combines 15 years of experience in profit management at Fortune 500 companies to teach you how to engage on today's fluid financial playing field. By the end of this course, you'll be competent to interpret financial statements and communicate figures to investors, managers, and other stakeholders.
What you'll learn
You'll come away from this course with a full toolset to advocate for your projects and budgets to key financial decision makers. Jennifer will help you build a functional knowledge of key topics in corporate finance needed to understand investing and financing decisions in your organization:
- Evaluating investment projects and companies
- Profit and loss statements (P&L) and how to manage them in a business unit of a company
- Leveraging conventional financial instruments (stocks and bonds) and alternative ones (commodities, forwards, and options) to bring value to corporations
- Innovations like cryptocurrencies and their impact on corporate economics
- Considerations for investment and financing decisions
- Market disruptors and real-world wildcards
financial compass
It's the hard truth of business: not having "finance" in your job title doesn't mean you don't have finance in your job. This course will teach you the fundamentals of corporate finance needed to make the business case for your products or budgets to financial decision-makers. You'll also learn about innovations in the finance world like crypto assets, and how to separate sound potential from hype.
experience
How many videos, talks, and books are still taking up real estate on your "I should learn that" list? This course is different, with live lessons and labs, graded assignments, office hours, and a final project. All these pieces help you assimilate new information quickly and immediately leverage it in your professional role.
case mockup
You'll use the frameworks, metrics, and tools you learn in class to assess a real publicly traded company over 7 weeks. Jennifer will ask you to take on the perspective of a financial analyst to propose recommendations for increasing profitability of a project currently in development.
CLARKE LinkedIn Profile
- Mastercard's Director of Finance in the North America region and Services Business Partner
- Proven track record of forecasting and driving revenue in global multinational corporations with multibillion-dollar market capitalizations
- Charterholder and member of the CFA®, the global industry standard for assets management
- 15+ years in corporate finance roles supporting industries including pharmaceutical, payments, and hedge funds
- Dedicated fan of podcasts and the New York Giants
We'll start off by diving into the roles on a typical finance team and the functions they perform. We'll prototype the corporate finance organizational structure, and discuss how this model can differ between organizations. Then, I'll introduce you to the publicly traded company we'll be analyzing throughout the course.
- Why do businesses need corporate finance?
- What types of corporate finance tasks are out there?
- How do corporate financial decisions get made?
- What are the main objectives of the CFO?
Assignment #01: Consider the publicly traded company introduced today. Complete the following to understand the company’s competitive positioning in the market:
- Determine the ticker and look up the company’s financial disclosures on sec.gov or their website
- List out the main business of the company
- Who are the company’s competitors?
- What are the biggest challenges of the company?
- What are your initial views on this company being a buy, based on what you know today?
The financial statement is the bread and butter of corporate finance. I'll walk you through the components of a financial statement — the balance sheet and the income statement — using a current company's real financial statements. You'll learn the simple formula that forms the base of the balance sheet and understand essential terms.
- Assembling and analyzing the balance sheet
- Income sheet vs. balance sheet
- Liquidity and financial leverage
- Accounting value vs. market value
- Balance sheet’s primary formula: Assets = Liabilities + Equity
Assignment #02: You will receive the company’s three main financial statements and be asked to calculate certain financial ratios, mainly on the balance sheet and income statement. Next, please comment on how the company’s ratios have changed over time, what that implies generally, and if that holds for this company specifically.
This class is dedicated to one of the most important parts of financial statements — cash flow, the structure of a cash flow statement, the components of cash flow, and how they differ from one another. What are the sources and uses of cash and methods of calculating cash flow?
- Z score: Why this is a powerful metric
- How companies access funding via capital markets
- Importance of capital markets for maintaining liquidity
- Company credit ratings and the limitations
Assignment #03: Use the financial statements provided in Assignment 2 to calculate liquidity ratios and metrics of the company over time. Look up the company’s Z score and analyze what that means as a going concern.
The notion of "time is money" is a very real one in corporate finance. In this class, we'll cover how the concept of the time value of money (TVM) and other key metrics factor into valuation. You'll learn how to calculate these metrics to accurately gauge a company's value against its competitors.
- Calculating TVM
- Relative valuation
- Discounted cash flow model vs. internal rate of return (IRR)
- Factoring for input/assumption bias
- Discount rates: Required rate of return (RRR), risk, and assessing stock volatility with beta
- Where to easily look up beta on a finance website
Assignment #04: You will receive forward-looking assumptions about the company, along with some questions on the value of the company’s stock price and other assets based on these assumptions. Look up the company’s current beta on a financial website and then use it and other data to calculate the company’s required rate of return. Now, comment on how the size of this company impacts the overall stock market’s returns.
We will cover the most important concepts and ideas of bond valuation methodologies and explain how bond yields and interest rates reflect interest rate risk, lack of liquidity, and taxability.
- Real vs. nominal interest rates
- How corporate bond issuance has changed since 2008
- Investment grade bonds vs. junk bonds
- What is the average credit rating of a corporate bond?
Assignment #05: Analyze the company’s current bond issuance and metrics relating to them. How does the company use borrowing to fund its cash needs, and how has the company staggered out when its bonds come due to manage risk?
This class will cover what is meant by the cost of capital and how companies use it to measure and compare potential investments. You'll learn about the difference between accounting profit and economic profit, and how to calculate the weighted average cost of capital (WACC).
- "Cost of capital" and evaluating investments
- How to calculate WACC
- Depreciation and tax impact on WACC
- Accounting profit vs. economic profit
Assignment #06: Determine the company’s WACC and compare how it has changed over time. Then, compare it to other public companies.
The business often works with finance departments to put forward new project business cases and to request capital investments. In this class, we will put together a request for the company we've been working with. Then, we will refer back to the concepts learned in our previous class to walk through how to build a basic financial model. The output of this financial model will tell us whether this project is worth investing in and if it will generate sufficient cash flow to recover its initial cost.
- Review: PV, IRR, time-to-break-even
- Scenario testing: How different assumptions impact the business case NPV, IRR, etc.
- Material nonpublic information: What you need to know
Assignment #07: Using what you now know about the company, put together a business case for the company. For this assignment, assume that the new investment will be an important new product launch, developed in-house (organically). You will build out a financial model based on assumptions that will be provided in class. Next, refer to new assumptions you will be given for different scenarios and explain how the valuation has changed, and if the investment is better or worse now.
Is it possible for business professionals to manage their own P&L? Absolutely, and in this class, we'll cover the key things to consider from a finance perspective.
- Forecasting: What, why, and how
- Risk and opportunity-adjusted forecasts
- Communicating forecast uncertainty
- Accounting treatment for recognizing revenue and expenses
- Think-Cell application for data presentation
Assignment #08: Complete exercises you will be given with different sales models (sell-in, trended revenues) to show different ways to forecast. Then, put together a budget for an upcoming year based on a company or business unit of the chosen company.
You may have heard that dividends are a major cash outlay for many corporations, and in this class, we'll find out why. You'll learn how to keep the investment in cash low while keeping the firm operating effectively, what flotation is, the reasons for holding cash, as well as the reasons to NOT hold excess idle cash.
- What happens when a company increases vs. reduces its dividend? What signal does it send to Wall Street?
- What's the typical dividend for growth companies vs. value/mature companies?
- What's the impact of corporate share repurchases on dividends and overall total cash returned to shareholders?
Assignment #09: Look up what the company’s current dividend is and its dividend yield. Compare it to other major companies and/or competitors. Next, research the history of the company’s dividend and how company strategy has changed over time relating to it.
In this class, we'll step beyond Wall Street to dig into the stock market's purpose and how it functions. You'll learn the basic approaches to stock valuation and the upcoming innovations in the stock market.
- Features of stock markets and the impact of technology
- Who are the major players in the stock market?
- Stock market crashes and what happened in 2020
- Key equity metrics and how they moved during the above periods
- Efficient markets vs. exploiting market inefficiencies
Assignment #10: Answer the following questions about the company:
- How did the company perform during the most recent periods?
- What is the company’s market capitalization, P/E, and related ratios?
- Compare them to other major companies. Who are the largest investors in the company? How much of the company do they own?
- Does the company attract activist investors?
Today, we're looking at additional financial instruments that corporations may trade, including commodities, forwards, and options markets. These instruments have different structures than stocks and bonds and unique use cases. I'll present several of these use cases; then, we'll walk through valuing a stock call.
- Common financial instruments: Overview, features, and uses
- What are the key factors in the valuation of each instrument?
- How do they differ from stocks and bonds in a portfolio?
- How do corporations use options, forwards, and commodities in their business?
- Practice: Stock call valuation
Assignment #11: Use a Black-Sholes option pricing calculator online to calculate the value of the company and comment on the differences.
Crypto assets have gained a lot of traction in financial markets, but do they meet the criteria of true "currencies"? In this class, I will explain the influence of cryptocurrencies and assets on the financial system and their associated risks and measurement issues. Then, we'll consider how crypto-assets affect the stability and efficiency of the financial system and the broader economy.
- Blockchain technology: What it is and uses beyond crypto
- Cryptocurrency: Commodity or currency?
- NFTs
- Sovereign-backed coins
Assignment #12: Does the company invest in cryptocurrency today? If not, do you think it should? Make the business case for investment in one of the crypto coins we covered today, answering the following questions:
- How could they use blockchain technology in their business beyond cryptocurrency?
- Should they accept cryptocurrencies in payment for products and services?
Innovations in the finance system stretch far beyond crypto. Today, I will introduce some of these new financial and investment products and discuss how they have revolutionized the financial system.
- Crowdfunding
- Fintechs
- Artificial Intelligence
- Mobile banking, open banking
- Robinhood and other disruptive players in the equity markets
Assignment #13: Use what you've learned today to answer the following questions:
- Who are the company's main investors?
- Do you think that disruptors like Robinhood can impact the company’s stock price?
What parts of finance merit our closer attention in 2021? With this question in mind, we will end our learning by looking at the latest trends and emerging fields within finance. We will devote special attention to explaining how the pandemic has influenced the stock market throughout the past year.
- Summary: What you've learned
- Sector/industry performance vs. overall market
- Trends and emerging fields in finance
Assignment #14: Answer the following questions:
- How has the company performed in 2020 vs the overall stock market?
- What are the advantages and challenges that the company will face in 2021and beyond, given these trends?
- Overall, do you think the company is a good long-term ‘buy’? Assess the objectivity and bias of your determination. How has your opinion changed or evolved since the beginning of the class?