My Core Capstone Experience

One of the most interesting parts of the Specialized Master in Finance program so far has been the Core Capstone Project that all SMF students complete in their second session at OSU. Since I just wrapped it up, I thought it would be good to share my experience with this project.

During your Capstone experience, you can choose one of two sections: an Investments focused section or a Corporate Finance focused section. If you select the Investment section, you are tasked to generate an Equity Research Report on a company of your choosing. If you select the Corporate Finance section, you complete a more general company report, focusing more on the company’s leverage rather than share price. To me, writing an Equity Research Report sounded really interesting, so I decided to join the Investments section. Once you decide on your section, you get to form a team with others in the same section and select a company that you want to focus on. My team consisted of 4 other classmates, and we decided to write our report on the Ohio based Proctor & Gamble. After that was settled, my team and I hit the ground running on the research phase. We spent about a week reading everything we possibly could about P&G. During this time, we drew information from a lot of different sources, but the two most helpful were Bloomberg Terminals and P&G earnings reports.

Once all of us felt like experts on P&G, it was time to start writing. The Equity Research Report had to be exactly 10 pages (not including the appendix) and had to include the following sections: Business Description, Industry Overview and Competitive Positioning, Investment Thesis, Summary of Intrinsic and Relative Valuation, Financial Analysis, Investment Risks, Overview of ESG and Legal/Regulatory Matters. Additionally, the appendix had to include Pro-forma Financial Statements, a DCF Model, and a Relative Value Model. For me, the most interesting part of this report was creating the Pro-forma financial statements and using them to generate a DCF model. This was the first I had done anything like this, so I was able to learn so much about forecasting cash flows and the assumptions that go into that. Because this was a learning experience for me and my groupmates, everything we did the first time around was not perfect. Thankfully though, as we were writing, we had weekly check-ins with a professor who had experience on Wall Street. He was able to provide us with a lot of feedback and really pushed us to output a professional level final report. After about 5 weeks of writing and rewriting, we finally had an Equity Research Report we were proud of. The hardest part of getting to here was actually cutting the paper down to include only the most relevant information that supported our buy or sell recommendation.

The final part of the Core Capstone Project was a 15-minute presentation to the rest of the SMF cohort about the company we chose to study. After doing so much research about P&G, it was easy to throw together a presentation and layout our findings from the paper. After a couple practice runs and a lot of time spent on slide design, we were able to deliver an informative presentation. With that wrapped up all that is left is getting feedback from professors who will be evaluating our reports. I am really looking forward to getting this back, as I think it will help me learn even more than I already have.

To wrap this up, I thought I would leave you with 3 general lessons I learned from my project:

• Do not write something if you do not have concrete reasoning behind it
• Communication is the key to effective teamwork on large projects
• Presentation and professionalism are required to push a report to the next level