Explain 3 statement financial model Calculating discount rate Could you walk me through the DCF model? Other valuation methods. What PE is ideal? What is the other matrix to value the company? Difference between IRR and CAGR. What is Bond Yield Which will have a better term 6 months IRR or CAGR of 10% Impact on bond price with change in interest rate, Duration, MC duration etc How to access the creditworthiness of the company or person How would you deal with the change in the credit quality of the company/person

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Financial analyst interview questions covering DCF model, valuation methods, bond yield, creditworthiness, and credit quality.

Three statement financial model includes income statement, balance sheet, and cash flow statement.
Discount rate is calculated using the weighted average cost of capital (WACC) or cost of equity.
DCF model involves projecting future cash flows and discounting them back to present value.
Other valuation methods include comparable company analysis (CCA) and precedent transaction analysis (PTA).
Ideal PE ratio varies by industry and company growth stage. Other metrics include EV/EBITDA and P/B ratio.
IRR measures the internal rate of return on an investment, while CAGR measures the compounded annual growth rate.
Bond yield is the return an investor receives on a bond investment. It can be calculated using the coupon rate and market price.
IRR and CAGR are different measures and cannot be compared directly.
Bond prices are inversely related to interest rates and duration. MC duration measures the bond's sensitivity to changes in interest rates.
Creditworthiness can be assessed using credit ratings, financial statements, and industry analysis.
Changes in credit quality can be addressed through credit monitoring, renegotiation of terms, or restructuring of debt.

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