I’ve been reading your posts on SS ER and they are very insightful. I have an interview coming up for a junior associate at a large investment bank and would greatly appreciate any tips on areas that I’m missing in my preparation. Here are the current bullet points I’m hitting. 1. Why do you want to do sell side research 2. Why the company 3. 2-3 stock pitches including market commentary a. Valuation & Finances b. Business & management c. Comparables d. Competitive advantages e. Themes for growth 4. 2-3 stock shorts 5. Financial modeling – how the statements interact 6. Economy over the next six months, next five years 7. Sector preferences 8. General accounting ratios a. EV/EBITDA b. ROE, ROA c. Payables, Receivables turnover, Cash conversion cycle d. WACC e. DCF f. P/E, P/S, P/BV 9. Healthy knowledge about the components in the sector for which I’m applying 10. Reviewed previous research from the senior analysts of the sector 11. How my position currently applies to this role 12. How research adds to the bottom line 13. Analyst background 14. 5-6 good questions a. Do you involve your associates in client interactions/calls? b. How the bank plans to further differentiates its research going forward c. What are the current challenges the department faces and how it plans to overcome that in the next couple of years Also, if I were lucky enough to be invited back for the second round, how are those interviews conducted in comparison to the first round? Should I expect some “heard on the street” brain teasers or is that reserved for IB?
Thanks Numi that is very helpful. Glad to hear that I am following the right path. I know that at its core, the junior associate position is responsible for: Updating existing models - based on earnings releases, calls, statements, company news, market indicators Drafting new models for coverage initiations - historical figures, building in toggles for each and every possible assumption to be made and scenarios, accumulating as much information as possible through IR/CEO/CFO/COO interviews & SEC docs, creating a DCF valuation Drafting reports - first draft of company commentary/advantages/disadvantages and recommendations, industry overview and trends, market share/competitive landscape, creating graphs/charts/diagrams of past performance and all of its attribution to be spread throughout report Drafting notes - updates on valuation and price targets based on most recent information But I could be missing something…
JScott, that’s a very comphrehensive list and it looks like you know exactly what you’re looking for. Have you interned in SS ER before or did you get it from a certain source (friends in SS/ Vault, etc.)?
I work for an ex-analyst now in a corp fin role + lots of research about the role
JScott24, again I think you have a good fundamental understanding of what the role entails. If you can articulate those things when someone interviews you asks about them, you’ll be in good shape. However, that will be expected of any good candidate. For you to go from being a “good” candidate to “very good” or better, you’ll also want to explain that you understand that it’s necessary but not sufficient for the junior associate to do those things. What good associates can do is that they demonstrate good stock sense, as well as the ability to proactively think about investment ideas. You want to show your senior analyst that you’re always looking for the extra incremental data point or tidbit of information that someone might not normally think about. The key is to come up with a differentiated view on an investment, and this is true for equity research, investment banking, VC, private equity, etc. – if you just follow the herd, you aren’t doing your job. Show that you can think critically about investments and that you will somehow give your senior analyst additional ammunition to come up with good investment calls.