Here’s his take on using Calcbench for financial analysis.
We interviewed Tom Philips, Adjunct Professor, Department of Finance and Risk Engineering, NYU’s Tandon School of Engineering. In addition to teaching, Tom is a Senior Investment Professor who was previously Global Head of Front Office Risk, BNP Paribas; Chief Investment Officer, Paradigm Asset Management; Managing Director, RogersCasey; Investment Research IBM
How did you learn about Calcbench?
I teach a course at NYU’s Tandon School of Engineering on valuation theory. I needed a source of data for students. I was going to the SEC’s website to get the information. I thought there was a better way to pull the data. In the course of a conversation with Dan Gode, I learned about Calcbench.
How do your students use Calcbench?
The historical data is important for valuations. With Calcbench, students are able to download financial statements over time. They can look at a company’s history going back five, even ten years ago.
For the class I teach, students need to value firms. To do that they need to understand:
Do you have any interesting examples of companies that were over/ under valued that you study?
There are many examples of valuations that don’t match the market price. One example that was a great learning lesson is Asian Paints. It was enormously overvalued.
With Calcbench, we have a lot of fun evaluating Tesla.
What are the challenges of using Calcbench?
Calcbench is powered by XBRL [Extensible Business Reporting Language, the global standard for exchanging business information]. Over time the quality of XBRL has improved dramatically but there have been issues around the data being tagged correctly to get a uniform set of financials. I have always been of the belief that XBRL should be audited the way financial statements are audited. It’s important that electronic representations are an honest representation of the paper representation.
I would also like to see broader coverage. It would be great to be able to access the full set of global companies and smaller cap companies. This will come over time.
There are a few things that I find most helpful about Calcbench. The first is being able to track data over date ranges. I like that I can pull data for a specific company, over time, in a consistent format.
What do you like most about Calcbench?
Calcbench is great for understanding corporate finance. If you are pulling data from the SEC’s Edgar database, Calcbench is orders of magnitude faster. You just download the report into Excel and extract information. It enables you to reduce data pulls from hours to seconds, at worst, minutes.
What other uses for Calcbench do you recommend?
Do you use Calcbench in the classroom or remotely or both?
I teach with Calcbench in the classroom, but students use Calcbench remotely for homework. In class, I like to look at examples on the screen. For the examples that we discuss in class, I have students download the companies financial statements into Excel and do the hard work on their own.
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