With some of our FT MBAs heading off to North Carolina for the VCIC this week, we felt a little something on due diligence might be in order…
If you’re researching a company with a view to an investment or acquisition, due diligence will be of utmost importance. Although much of the data and information required for this exercise will come from the target company itself, there are various areas here where our Library resources can help. Also bear in mind that library resources might be more comprehensive than the (possibly selective) data the target company provides.
The chances are that the company you are looking at will be private. Financials for firms – public and private, large and small – in the UK and Ireland are available in Fame. Publicly listed companies worldwide are best covered by Thomson One and Bloomberg.
Through Fame, you can access up to ten years of financial data – including balance sheets, profit and loss and cash-flow where appropriate. Copies of original Companies House filings are available too. You can also view data on comparable companies via Fame’s Peer Report and Peer Analysis functions.
Thomson One will give you balance sheets, income statements and cash-flow back to the 1980s, along with a wide variety of financial ratios, revenue segmentation, financial transactions and forecasts. Comparable analysis is readily available for pre-defined or customised peer groups. Access is also available to brokers’ reports for expert analysis on both company and industry.
Bloomberg’s <FA> (Financial Analysis) function gives you access to a wealth of company financials including estimates and forecasts for listed companies worldwide – such as stock data, balance sheets, cash flow, income statements, profit and loss and ratios. Comparables are accessible through any company report, as are segmentation data and brokers’ reports. Bloomberg is only accessible from dedicated terminals in the School’s Bloomberg Suite.
Industry & Market Research:
You will also need a thorough knowledge and understanding of the industry and market in which the company operates along with its technologies and operations. Use industry research available via MarketLine Advantage and IBISWorld to research the key drivers, industry performance and outlook and major players. BMI Research may be useful here too. When it comes to the market, you need to know that there are customers out there who want to buy your company’s products or services. Use Mintel (UK) and Passport for market research.
Resources listed below will also provide information on the business environment, both legal and environmental, that the company operates in. If you’re interested in ESG filings, use Bloomberg.
IBISWorld provides concise industry reports for UK, US and global markets, covering performance and outlook (including some forecasts), competitive landscape, and operating conditions. It also situates a company within its supply chain, highlighting demand and supply industries which will impact on yours.
In addition to the industry overview and outlook, MarketLine reports are built around a Five Forces Analysis which provides a framework from which to analyse the competitive forces which shape any industry.
BMI provides quarterly industry reports on a wide range of major industries worldwide. Reports are much broader in outlook to those in IBISWorld, but include both 5 and 10 year forecasts for the sector.
Mintel covers most of the UK’s consumer and B2B markets. Reports are updated every 12 to 24 months. Within a report you will have access to analysis on the UK market, including market drivers, size, segmentation and forecasts; consumers and their attitudes, and research on major brands and players in the market. Downloadable databooks are also available to accompany most reports.
Passport’s country-specific ‘category briefings’ are concise market reports for most consumer goods markets worldwide which cover headlines, trends, competitive landscape and prospects. They include links to related reports and statistics.
Primarily a financial tool, Bloomberg is our main source of ESG data for listed companies. This area, environmental, social and governance, covers what Investopedia refer to as “a set of standards for a company’s operations that socially conscious investors use to screen investments”.
When you invest in a company, you also invest in its people. You will want to know everything you can about the company management team, their business interests and what they bring to the organisation.
Run an Officer and Director search on Fame within the Screening & Analysis function. From there you can view other directorships individuals may hold (both past and present) within the UK and Ireland.
View past and present company directorships for named individuals in listed companies worldwide via the Screening & Analysis menu.
Biographies are available for prominent business people, global figures along with Bloomberg users. Research their life and work both past and present – education and career history, board memberships and publications. Use the <BIO> function to find these.
If you have any questions at all about any of the resources mentioned here, please contact MIRC.0