Company Analysis: Past, Present, and FutureLocked: included in All Access

Analysing a company: its competitive strategy and position, business model, revenue drivers and pricing power, operating profitability, working capital, capital investments and capital structure.

1. 1. Competitive strategy and positioningA company's strategy is judged by whether it defends against the five forces, fits the external influences and can be executed with the company's resources; most successful strategies are variants of cost leadership, differentiation or focus.Locked: included in All Access15 min
2. 2. Strategy over the life cycle and addressable marketsWhat a company's strategy should look like depends on its life-cycle stage: startups prove a business model, growth firms are judged on the size of the market they can reach, declining firms cut, restructure or reinvent.Locked: included in All Access13 min
3. 3. Generic strategies in practice: capacity, moats and two kinds of focusTo turn a generic strategy into forecasts, the analyst looks for the operating evidence each one leaves (capacity utilisation and unit costs for a cost leader, hard-to-copy features for a differentiator, a chosen niche and basis for a focuser) and links stated goals to revenue drivers.Locked: included in All Access13 min
4. 4. Revenue drivers: bottom-up and top-downRevenue analysis breaks sales into drivers: bottom-up into volume and price or per-unit measures, top-down into market size and market share, so the analyst can see what really caused growth.Locked: included in All Access14 min
5. 5. Pricing powerManagement can set any price it likes, but pricing power, the ability to raise prices without losing volume, depends on market structure and competitive position, and shows up as margins that hold or rise over time.Locked: included in All Access11 min
6. 6. Operating costs and operating leverageHow much of a company's cost base is fixed decides how violently operating profit reacts to a change in sales; operating profit = Q × (P − VC) − FC, and the degree of operating leverage measures the sensitivity.Video · 6 minLocked: included in All Access14 min
7. 7. Operating profitability and working capitalMargins built from functional cost lines (gross, EBITDA, EBIT), costs expressed as a percentage of revenue, and working capital measures (cash conversion cycle, net working capital to sales) show how efficiently a company turns revenue into profit and cash.Locked: included in All Access15 min
8. 8. Choosing a profit margin, cost components and price elasticityNet, operating and EBITDA margins each answer a different question and each can mislead; cost components compared with peers sharpen the picture, and pricing power rises when demand is price inelastic, competition is limited and the firm leads its market.Locked: included in All Access14 min
9. 9. Capital investments and capital structureStart by mapping where capital came from and where it went, then judge whether investments earned more than the cost of capital (ROIC vs WACC) and how much risk the capital structure adds (leverage, coverage, DFL), tying it together with the ROE decomposition.Locked: included in All Access15 min
10. 10. FCFE, net capex and financing across the life cycleFree cash flow to equity ties the income statement and balance sheet together (net income plus D&A, less investment in working capital and long-term assets, plus net borrowing), and its size, the need for capital spending and the room for debt all change as a company moves through its life cycle.Locked: included in All Access14 min