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Financial Modeling
The Financial Modeling phase is where CYG Partners brings insights to life by analyzing the financial viability of shortlisted targets.
This process ensures you gain a comprehensive understanding of potential returns, risks, and strategic value before moving forward with an acquisition or investment.
Gather Financial Data
Inputs
Historical financial statements
Operational metrics, industry benchmarks, and market data
Actions
Collect all relevant financial and operational information from the shortlisted targets
Validate the accuracy and completeness of the data provided
Output
A detailed dataset to serve as the foundation for financial modeling
Understand Business Drivers
Actions
Identify the key revenue drivers (e.g., volume, pricing, market share)
Assess cost structures, margins, and fixed vs. variable expenses
Map industry trends and external factors impacting growth (e.g., economic conditions, competition)
Output
A clear understanding of the target’s growth levers and profitability metrics
Develop Financial Projections
Actions
Build forward-looking financial models (3–5 years) based on historical performance and industry benchmarks
Integrate revenue, cost, and capital expenditure assumptions into the model
Create multiple scenarios (base case, optimistic, pessimistic)
Output
Forecasted financial statements with key performance metrics
Valuation Analysis
Actions
Apply valuation methodologies (DCF, Comparables, Precedent Transactions)
Assess intrinsic value based on future cash flows and market positioning
Cross-check valuation with industry benchmarks and peer group multiples
Output
A detailed valuation report with justification for the derived enterprise and equity value
Sensitivity Analysis
Actions
Test assumptions under different scenarios to assess risks (e.g., changes in revenue, costs, or discount rates)
Identify potential vulnerabilities and upside opportunities
Output
A range of valuation outcomes with identified key risk factors and mitigations
Investment Recommendation & Feedback Loop
Actions
Summarize findings in an actionable report, highlighting risks, opportunities, and strategic alignment
Provide an investment recommendation based on financial viability and client objectives
If assumptions don’t align or further data is required, loop back to earlier steps (e.g., refining projections or valuation models)
Output
A finalized investment recommendation with robust financial backing
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Financial Modeling
Gather Financial Data
Historical financial statements
Operational metrics
Industry benchmarks
Market data
Collect all relevant financial and operational information from the shortlisted targets
Validate the accuracy and completeness of the data provided
A detailed dataset to serve as the foundation for financial modeling Financial Modeling
Understand Business Drivers
Identify the key revenue drivers
Assess cost structures, margins, and fixed vs. variable expenses
Map industry trends and external factors impacting growth
A clear understanding of the target’s growth levers and profitability metrics Financial Modeling
Develop Financial Projections
Build forward-looking financial models (3–5 years) based on historical performance and industry benchmarks
Integrate revenue, cost, and capital expenditure assumptions into the model
Create multiple scenarios (base case, optimistic, pessimistic)
Forecasted financial statements with key performance metrics Financial Modeling
Valuation Analysis
Apply valuation methodologies (DCF, Comparables, Precedent Transactions)
Assess intrinsic value based on future cash flows and market positioning
Cross-check valuation with industry benchmarks and peer group multiples
A detailed valuation report with justification for the derived enterprise and equity value Financial Modeling
Sensitivity Analysis
Test assumptions under different scenarios to assess risks (e.g., changes in revenue, costs, or discount rates)
Identify potential vulnerabilities and upside opportunities
A range of valuation outcomes with identified key risk factors and mitigations Financial Modeling
Investment Recommendation & Feedback Loop
Summarize findings in an actionable report, highlighting risks, opportunities, and strategic alignment
Provide an investment recommendation based on financial viability and client objectives
If assumptions don’t align or further data is required, loop back to earlier steps (e.g., refining projections or valuation models)
A finalized investment recommendation with robust financial backing