FRIDAY, FEB 7 2014WEEKLY MEETING

INVESTMENT CLUB

PREVIEW

1. Market Update

2. Club Overview

3. Interview Tips

4. Stock Fundamentals

Market Update

Expedia Earnings

Reported earnings – Earnings beat estimatesStock appreciated 13% after hoursWas down 4.3% due to search-engine

concernsDifficult to separate from competitorsClub has enjoyed 30% gains

Long-Term Jobless Benefits Rejected

Republicans blocked 3 month extension

Could hurt consumer confidence

Discourages workers to continue job search

Issue could be revived depending on debt limit

Market Volatility

The S&P 500 appreciated 30% - 2013Investors estimate between 8-10% for 2014Reduce positions in U.S. small company

stocksBlue chip stocks / short – term bondsTech giants Apple and Cisco highlighted

Established infrastructure Pay dividends

Improved Labor Market

Fed officials concerned with fast falling unemployment

Contradicts Okun’s LawBy U6 measure, unemployment was 13.1%When should Fed raise rates?

Too quickly: dampen economic recovery Too slow: fuels inflation, financial bubbles

Global Economy

Continued pessimism for economic recoverySentiment based upon:

Tumbling stock prices Fed’s taper of QE Weak U.S. reports in car sales, home sales, hiring Emerging Markets: Brazil growth down 5% since 2011 Concerns in Chinese growth (2nd largest economy)

CLUB OVERVIEW

Investment Club

OVERVIEW: 1. Close to $500,000

2. Over 40 stocks

3. Strictly Student Run

GOALS

1. Manage and Grow Portfolio

2. Educate Members

3. Network

WHY INVESTMENT CLUB?

New Ideas

1. Shareholder Meeting

Ideas

2. Freshman Investing Crash Course

3. Wall Street Panel

Ideas

4. Stock Pitch Battle

5. WSJ Quiz

Ideas

6. Mentorship Program

7. Interview Prep

INTEVIEW PREP

INTERVIEW PREP

NETWORKING, NETWORING, NETWORKING

WHAT YOU NEED:

*** STRONG GPA *** UNDERSTANDING OF MARKETS *** DESIRE TO LEARN

Wall Street Interview

COURSE WORK: - Financial Accounting, Financial Theory, Corporate Finance, ect.

COMMON QUESTIONS

FIT QUESTIONS:

1. How did you prepare for this interview?

- Coursework, WSJ, Barrons, ect.

2. Describe a moment when you worked under pressure?

- Time crunch, stick to basics

Banking Questions

1. What is the main goal of an investment bank? - Get company from point A to B

2. Briefly tell me about recent major financial transactions? 3. Explain Structure of XYZ Bank? - Read 10K

Questions

4. Most important trends in economy?

5. Do you follow a certain stock?

6. Role of a summer intern/ full time analyst?

7. Why XYZ Bank? - CEO: Direction of firm

FINANCIAL QUETIONS

1. How does Net Income influence all 3 financial statements?- Income Statement, Balance Sheet, Cash Flow

2. Basic Methods for Valuing a Company?- Comparable Analysis- Precedent Transaction Analysis- DCF

BRAIN TEASERS

Q: You’ve got a 10 x 10 x 10 cube made up of 1 x 1 x 1 smaller cubes. The outside of the larger cube is completely painted red. On how many of the smaller cubes is there any red paint?

BRAIN TEASER

A: First, note that the larger cube is made up of 1000 smaller cubes.  The easiest way to think about this is how many cubes are NOT painted?  8 x 8 x 8 inner cubes are not painted which equals 512 cubes.  Therefore, 1000 – 512 = 488 cubes that have some paint.  Alternatively, we can calculate this by saying that two 10 x 10 sides are painted (200) plus two 10 x 8 sides (160) plus two 8 x 8 sides (128).  200 + 160 + 128 = 488.

RESOURCES

1. FINANCIAL NEWS OUTLET

2. MACABACUS. COM

3. WALLSTREETOASIS.COM

4. GLASSDOOR.COM

Qualitative Analysis of Tesla (TSLA)

BY BRENDAN GOVER

Common Qualitative Measures

Dan Killmurray ’85 (UBS)

TAM

Moat

Management

Management track record/compensation package

Elon Musk

Previous/current other business ventures

COMMENTS?

How can the club improve?

Suggestions?