Part 1 FRAMEWORK
  1 A Framework for Business Analysis and Valuation Using Financial Statements
   The Role of Financial Reporting in Capital Markets
   From Business Activities to Financial Statements
   From Financial Statements to Business Analysis
   Summary
   Discussion Questions
 Part 2 BUSINESS ANALYSIS AND VALUATION TOOLS
  2 Strategy Analysis
   Industry Analysis
   Applying Industry Analysis: The Personal Computer Industry
   Competitive Strategy Analysis
   Corporate Strategy Analysis
   Summary
   Discussion Questions
  3 Overview of Accounting Analysis
   The Institutional Framework for Financial Reporting
   Factors Influencing Accounting Quality
   Steps in Doing Accounting Analysis
   Accounting Analysis Pitfalls
   Value of Accounting Data and Accounting Analysis
   Summary
   Discussion Questions
  4 Implementing Accounting Analysis
   Recasting Financial Statements
   Asset Distortions
   Overstated Assets
   Understated Assets
   Liability Distortions
   Equity Distortions
   Summary
   Discussion Questions
   Appendix: Recasting Financial Statements Into Standardized Templates
  5 Financial Analysis
   Ratio Analysis
   Cash Row Analysis
   Summary
   Discussion Questions
   Appendix: Part A: Nordstrom, Inc. Financial Statements
   Part B: The TJX Companies, Inc. Financial Statements
  6 Prospective Analysis: Forecasting
   Relation of Forecasting to Other Analyses
   The Techniques of Forecasting
   Making Forecasts
   Sensitivity Analysis
   Summary
   Discussion Questions
   Appendix: The Behavior of Components of ROE
  7 Prospective Analysis: Valuation Theory and Concepts
   Defining Value for Shareholders
   The Discounted Abnormal Earnings Valuation Method
   Valuation Using Price Multiples
   Shortcut Forms of Earnings-Based Valuation
   The Discounted Cash Flow Model
   Comparing Valuation Methods
   Summary
   Discussion Questions
   Appendix: Reconciling the Discounted Dividends and Discounted Abnormal Earnings Models
  8 Prospective Analysis. Valuation Implementation
   Detailed Forecasts of Performance
   Computing a Discount Rate
   Terminal Values
   Computing Estimated Values
   Summary
   Discussion Questions
 Part 3 BUSINESS ANALYSIS AND VALUATION APPLICATIONS
  9 Equity Security Analysis
   Investor Objectives
   Equity Security Analysis and Market Efficiency
   Approaches to Fund Management and Securities Analysis
   The Process of a Comprehensive Security Analysis
   Performance of Security Analysts and Fund Managers
   Summary
   Discussion Questions
  10 Credit Analysis and Distress Prediction
   The Market for Credit
   The Credit Analysis Process
   Financial Statement Analysis and Public Debt
   Prediction of Distress and Turnaround
   Summary
   Discussion Questions
  11 Mergers and Acquisitions
   Motivation for Merger or Acquisition
   Acquisition Pricing
   Acquisition Financing
   Acquisition Outcome
   Summary
   Discussion Questions
  12 Corporate Financing Policies
   Factors That Determine Finns' Debt Policies
   The Optimal Long-Term Mix of Debt and Equity
   The Financing of New Projects
   Factors That Determine Dividend Policies
   Summary
   Discussion Questions
  13 Communication and Governance
   Governance Overview
   Management Communication with Investors
   Communication Through Financial Reporting
   Other Forms of Communicating with Investors
   Auditor
   Analysis
   Audit Committee Reviews
   Summary
   Discussion Questions
 Index