<p>I have a few interviews coming up, so I was wondering what some of the more typical technical and fit questions are? Especially any that may catch someone off guard. Some I have compiled are:</p>
<p>What kind of merger was it (accretive or dilutive) when a company aquired another company with a higher P/E?
What is enterprise value?
Run me through a DCF
How do you value a company?
Describe a time when you were instrumental in helping a group reach a consensus or a plan
Describe an ethical situation you encountered
What is your greatest failure? What did you learn from it?
If you were CEO what 3 things would you change about the firm?
What is a stock/bond you recommend?
When have you worked in a team?
What is the biggest risk youve ever taken?
What is your biggest weakness?</p>
<p>at the risk of sounding like a complete idiot, how much information are we required to know about ibanking? i have NO clue what enterprise value was defined by, and there are several other things im sure im clueless about. what should i have a general knowledge of?</p>
<p>The questions he posted are very, VERY basic investment banking interview questions. I suggest you get vault guide or some other finance interview guide if you don’t know the answer to these questions.</p>
<p>Other common questions could be things like “how does depreciation going up by $10 affect a company’s three financial statements” or “how do you calculate a firm’s discount rate”</p>
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<p>No P/E refers to price/earnings. A company with a higher P/E acquiring another company with a lower P/E in an all stock deal would be accretive (as in EPS of the acquirer goes up)</p>
<p>here are some other basic technical questions:</p>
<ul>
<li>how would you value a company? </li>
<li>Walk me through a DCF valuation. </li>
<li>Of the three methodologies which one is likely to result in a higher/lower value? why?</li>
<li>What is the difference between a comparable & a competitor?</li>
<li>What are common valuation metrics?</li>
<li>What is EBITDA & why is it used?</li>
<li>Why cant you use EV/Earnings or Price/EBITDA as valuation metrics?</li>
<li>What is the difference between Enterprise Value & Equity Value?</li>
<li>How is Enterprise Value calculated?</li>
<li>Why do you subtract cash from enterprise value formula?</li>
<li>What is minority interest and why do you add it back to enterprise value?</li>
<li>What is the difference between basic and fully diluted shares?</li>
<li>How do you use the Treasury Stock Method to calculate fully diluted shares?</li>
<li>Which is less expensive capital, debt or equity?</li>
<li>Walk me through an accretion/dilution analysis.</li>
<li>What factors can lead to dilution of EPS in an acquisition?</li>
<li>Why might one company want to acquire another?</li>
<li>Explain the concept of synergies & provide examples.</li>
<li>What is working capital?</li>
<li>What are deferred taxes?</li>
<li>What is goodwill and how is it calculated?</li>
<li>What happens to each of the three financial statements if X (usually something like depreciation, etc.) increases/decreases?</li>
</ul>
<p>for S&T, I felt the questions were a bit more technical and related to markets and trading in general. A few questions that I faced last time were as follows.
a) What is a plain vanilla interest rate swap?
b) What is a convertible bond?
c) What does a rising yield curve indicate?
d) In a CDO, if the default correlations increase over time what will happen? How should the investor be compensated?
e) How does an ETF work?
May be some questions regarding CAPM and its applicability.</p>
<p>These were just for S&T, Barclays and Goldman in particular.</p>