Scenario Analysis Spreadsheet
How to use the tool
1. Find the ticker symbol:
Search for the company’s ticker symbol by typing “Company Name + Stock” on Google.
Copy the correct ticker symbol. If necessary, include the exchange ticker for accuracy. (See image below)
2. Enter assumptions:
Input your assumptions in the blue cells. This is very important. This will drive your entire valuation and (potential) return.
3. Verify currency:
Check the currency. If it's incorrect, select the cells, go to 'Format' > 'Number,' and choose 'Custom Currency' to make adjustments.
4. Check calculations:
Many of the white cells contain automatically calculated values. Do not edit these cells.
About the Scenario Analysis
Scenario analysis is similar to a reverse DCF model, relying on three key value drivers:
Revenue,
Profit margin
Exit multiple
Unlike traditional DCF models, it avoids complexity and encourages critical thinking about these factors.
This method helps estimate potential annual returns but keep in mind:
Returns should beat inflation.
It doesn't include dividends or share buybacks.
Wrong assumptions can lead to big changes in results.
Scenario analysis is an easy way to value a business without complex calculations. However, it might miss hidden value in holding companies, making them seem more expensive.