Browse Our Resources For Acing Your Next Interview
Investment banking interviews are often very technical, testing you on financial concepts not taught in the classroom. The Finance Interview Coach Resources page was created to offer candidates with additional resources to assist in preparing for their interview.
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If you were shrunk to the size of a pencil and put in a blender, how would you get out?
This is a brain teaser as well as a chance for employers to see if you have a sense of humor and creativity. It’s less important to get the right answer and more important to explain your logic. First, you should stay calm and observe your surroundings. Take note of the blender’s interior. Are there […]
If a company is growing, has positive EBITDA margins, and growing customer base, how could it post a loss?
Even if a company is growing and has positive EBITDA margins, it is possible that the expenses beneath EBITDA are large enough to counteract any positive EBITDA, ultimately resulting in a negative net income. Expense items beneath EBITDA include: depreciation and amortization, interest, and tax. These expense items, when combined with EBITDA, could be enough […]
How do you adjust the balance sheet in an LBO?
First, we can account for the equity purchase. We should subtract any existing shareholder’s equity from the target’s balance sheet, since we’re buying it. Then we should add the equity invested from the sponsor and management rollover which can be found in the sources and uses table. Then we can subtract the old debt and […]
What is net operating income (NOI)?
Net operating income (NOI) measures the core profitability of real estate properties. It’s calculated as: NOI = revenue generated from property – operating expenses NOI is before any cost of financing (such as debt or mortgage interest expense) as well as income taxes. It focuses only on the core revenues and expenses directly related to […]
If a company has negative enterprise value, what does that mean?
This means that the company must have more cash than the equity value, debt, and preferred equity combined together. Cash is subtracted from the enterprise value, so the larger cash is, the lower the enterprise value. The company also likely has a suppressed equity value due to negative investor sentiment. Investors are expecting the company […]
