Company analysis and valuation logic for Level II equity item sets.
Level II Equity Investments is where modeling assumptions start to matter more than textbook definitions. The exam often tests whether you can match the company setting to the valuation approach, diagnose which assumption is driving the result, and reject answers that are numerically neat but economically weak.
That is why the chapter starts with a grouped lesson batch rather than a one-page-per-reading mirror. The useful online shape is valuation process first, then dividend and growth logic, then free cash flow and residual income, and finally multiples and private-company adjustments where comparability becomes the real question.
| Lesson | Official coverage boundary | What to focus on |
|---|---|---|
| Valuation Process, Required Return, and Model Choice | Equity Valuation: Applications and Processes | Intrinsic value versus price, industry and competitive analysis, model-family choice, and why required return assumptions matter before you open a model. |
| Dividend Discount, Growth, and Terminal Value | Discounted Dividend Valuation | Choosing the right DDM structure, reading growth and payout assumptions correctly, and spotting when terminal value is dominating the result. |
| Free Cash Flow and Residual Income Valuation | Free Cash Flow Valuation; Residual Income Valuation | FCFF versus FCFE perspective, residual income as a book-value-based valuation framework, and when each model fits the company better. |
| Multiples and Private Company Valuation | Market-Based Valuation: Price and Enterprise Value Multiples; Private Company Valuation | When comparables are truly comparable, how justified multiples are built from fundamentals, and how private-company adjustments change the answer. |