Maintenance covenants
Maintenance covenants are tested on a schedule and a breach hands lenders the right to call the loan.
Taught in Debt, Credit & Leverage · study this deck
ViewPrep / Glossary
138 terms, each explained in a single sentence and linked to the deck where it is taught properly. Every definition is taken from a card on this site, so nothing here is longer than it needs to be.
The 4 Ps are the four levers a company pulls to bring a product to market.
Taught in Marketing Fundamentals · study this deck
Assume in-the-money options are exercised, spend the cash on a buyback, and count only the net new shares.
Taught in Enterprise & Equity Value · study this deck
Attractiveness is size, growth, profitability, and how concentrated the competition already is.
Taught in Growth Strategy & Market Entry · study this deck
Barriers to entry are whatever keeps new competitors from entering and challenging incumbents.
Taught in Microeconomics & Market Structures · study this deck
A beat is a result above consensus; the price only rises if the beat is bigger than what the market had quietly hoped for.
Taught in Earnings & Guidance · study this deck
The bid-ask spread is the gap between what buyers offer and what sellers demand.
Taught in Financial Markets & Instruments · study this deck
A bond is a loan on fixed terms, set interest payments plus a set date to get your money back.
Taught in Financial Markets & Instruments · study this deck
Borrowing and repaying principal are financing cash flows that swap cash for debt and never touch profit.
Taught in Three-Statement Drills · study this deck
A bottleneck is the slowest station in a process, and it caps what the whole system can produce.
Taught in Operations & Supply Chain Management · study this deck
A brainstorming question is scored on breadth in organised buckets first, then depth on one or two ideas.
Taught in Brainstorming & Hypotheses · study this deck
Brand equity is the extra value a name adds on top of what the product actually does.
Taught in Marketing Fundamentals · study this deck
Break-even is fixed costs over the margin: £2m of sales, or 2,000 baskets a week against a norm of 2,500.
Taught in Practice Cases · study this deck
Break-even quantity is fixed costs divided by the contribution margin on one unit.
Taught in Profitability & Cost Analysis · study this deck
CAC is what it costs to win a customer; LTV is the profit they generate before they leave; LTV should be about three times CAC.
Taught in Business Models & Unit Economics · study this deck
Capital structure is just the mix of debt and equity a company uses to fund itself.
Taught in Corporate Finance & Investment Basics · study this deck
A carve-out’s reported profit is an allocation, not a business that has ever stood on its own.
Taught in M&A & Due Diligence Cases · study this deck
A case interview is a short business problem you solve out loud, with the interviewer, in real time.
Taught in Case Interview Structuring · study this deck
Cash is subtracted because a buyer gets it back on day one, so it lowers the real cost of the operations.
Taught in Enterprise & Equity Value · study this deck
Cash deals are accretive when the target’s earnings yield beats the after-tax cost of debt, 8.3% against 4.5%.
Taught in Merger & LBO Maths · study this deck
Cash in advance is a liability called deferred revenue until delivery, then it turns into revenue.
Taught in Three-Statement Drills · study this deck
Channel conflict is what happens when two routes to the same customer start competing with each other.
Taught in Marketing Fundamentals · study this deck
Churn is the share of customers who leave each period; because lifetime is one over churn, halving churn doubles lifetime value.
Taught in Business Models & Unit Economics · study this deck
CLV is the total profit one customer is worth over the whole relationship, not just their first order.
Taught in Marketing Fundamentals · study this deck
COGS is the cost of the thing you sold, operating expenses are the cost of running the company.
Taught in Reading Financial Statements · study this deck
Comps value a company by comparing it to similar public companies' current pricing.
Taught in Valuation Basics · study this deck
Concise is saying everything that matters in the fewest words; brief is just stopping early.
Taught in Synthesis & Structured Communication · study this deck
A confidence interval is a range of plausible values, not a single guess — it expresses how much uncertainty surrounds an estimate.
Taught in Statistics & Data Analysis for Business · study this deck
Consensus is where the market is; a model is how you decide whether the market is wrong.
Taught in Earnings & Guidance · study this deck
Contribution margin is what one extra sale leaves behind after its own variable cost, before any fixed costs.
Taught in Profitability & Cost Analysis · study this deck
Cost of capital is the minimum return a company must earn on anything it invests in, or it's destroying value.
Taught in Corporate Finance & Investment Basics · study this deck
Cost synergies are savings the buyer controls, revenue synergies depend on customers behaving as hoped.
Taught in M&A Fundamentals · study this deck
Cost-plus is easy and defensible, but it ignores the customer and can spiral once volume drops.
Taught in Pricing Strategy · study this deck
Covenants are the conditions attached to a loan, and breaching one hands the lenders leverage over the deal.
Taught in LBOs & Private Equity Basics · study this deck
Debit means left, credit means right — which one grows an account depends on the account type.
Taught in Accounting Fundamentals · study this deck
Current means settled within twelve months, non-current means everything longer.
Taught in Reading Financial Statements · study this deck
Cycle time is the gap between finished units and throughput is how many finish per hour.
Taught in Operations & Supply Chain Management · study this deck
Data is worth something only when it is unique, tied to an outcome, joinable and legally usable.
Taught in Digital & Tech Cases · study this deck
A DCF says a company is worth all the cash it will ever generate, brought back to today's dollars.
Taught in Valuation Basics · study this deck
A deal is accretive if the buyer’s earnings per share end up higher after it than they would be alone.
Taught in M&A Fundamentals · study this deck
Debit means left, credit means right — which one grows an account depends on the account type.
Taught in Accounting Fundamentals · study this deck
Debt is paid first for a capped return, equity is paid last with no ceiling on the upside.
Taught in Financial Markets & Instruments · study this deck
Demand is what buyers would buy at every price, supply is what sellers would offer at every price.
Taught in Microeconomics & Market Structures · study this deck
A digital case is an ordinary business case where the lever is technology, and the test is still profit.
Taught in Digital & Tech Cases · study this deck
Digitising an existing business is a cost problem, while building a new one is a demand problem.
Taught in Digital & Tech Cases · study this deck
A discount rate is the return available elsewhere at the same risk, so it sets the price of waiting.
Taught in Corporate Finance & Investment Basics · study this deck
A dollar today is worth more than a dollar later, because today's dollar can already be earning a return.
Taught in Corporate Finance & Investment Basics · study this deck
Each named framework is a checklist for one kind of question, not a general purpose case answer.
Taught in Case Interview Structuring · study this deck
EBITDA is not cash, and companies fail when the cash runs out rather than when earnings look weak.
Taught in Debt, Credit & Leverage · study this deck
Economies of scope save money by producing different products together, not just more of one.
Taught in Management & Strategy Frameworks · study this deck
Enterprise value is the whole business; equity value is just the shareholders' slice.
Taught in Valuation Basics · study this deck
Equilibrium is the one price where what buyers want to buy matches what sellers want to sell.
Taught in Microeconomics & Market Structures · study this deck
Equity holders are paid last and promised nothing, so they demand a bigger return than lenders do.
Taught in Corporate Finance & Investment Basics · study this deck
Exit EV is 8 × £133.8m = £1,070.6m, and taking off £320.6m of debt leaves £750m of equity.
Taught in Merger & LBO Maths · study this deck
The failure is only the setup, what you changed afterwards is the actual answer.
Taught in The Investment Banking Interview · study this deck
The final answer is seldom the differentiator, how you got there and what you were like usually is.
Taught in The Consulting Interview · study this deck
A first-day pop is partly deliberate underpricing and partly information the deal could not fully see.
Taught in IPOs & Equity Capital Markets · study this deck
Flat revenue means the answer is in the costs, and here one line, cost of goods, explains the whole £8m.
Taught in Practice Cases · study this deck
Free cash flow is what’s left after paying for the spending needed to keep the business running.
Taught in Reading Financial Statements · study this deck
Funding assets with debt means the same operating result produces a bigger swing in the return on the owners' smaller stake.
Taught in Capital Structure & Leverage · study this deck
GDP is the value of everything an economy produces in a period; a recession is that number shrinking for two quarters in a row.
Taught in Markets & Macro Awareness · study this deck
Going public means selling shares to public investors and living under public disclosure from then on.
Taught in IPOs & Equity Capital Markets · study this deck
Goodwill is the premium a buyer pays above the fair value of what the target actually owns.
Taught in Accounting Fundamentals · study this deck
Growth is old or new products sold to old or new customers, and doing both at once is riskiest.
Taught in Management & Strategy Frameworks · study this deck
Guidance is management's forecast for the coming period, and shares are priced on the future, not the quarter just finished.
Taught in Earnings & Guidance · study this deck
A hypothesis is a testable sentence: profits fell because X, which we would see as Y in the data.
Taught in Brainstorming & Hypotheses · study this deck
An index is a rules-based basket used as a scoreboard, and passive funds just buy the whole basket.
Taught in Financial Markets & Instruments · study this deck
Inflation is the rate at which prices rise, measured by a basket of goods, and 2% is the level that keeps money stable without freezing the economy.
Taught in Markets & Macro Awareness · study this deck
The installed base is a stock, annual sales are a flow, and the replacement cycle converts between them.
Taught in Market Sizing & Guesstimates · study this deck
Interest is tax-deductible, so £10 of interest costs the company £7.50 of cash after the tax saving.
Taught in Three-Statement Drills · study this deck
Internal is what the client controls, external is the market around it, and together they cover everything.
Taught in Brainstorming & Hypotheses · study this deck
Investors' required returns are on what their claims are worth today, not on what the accounts recorded years ago.
Taught in Capital Structure & Leverage · study this deck
An IPO is a private company's first sale of shares to the public, becoming publicly traded.
Taught in Financial Markets & Instruments · study this deck
IRR is the discount rate that makes a deal's NPV exactly zero, its own break-even return.
Taught in Corporate Finance & Investment Basics · study this deck
An LBO is an extreme capital structure choice: fund most of the purchase with debt, use the company's cash to repay it, and let leverage magnify the equity return.
Taught in Capital Structure & Leverage · study this deck
Lead time is the full clock from placing an order to actually having it in hand.
Taught in Operations & Supply Chain Management · study this deck
Leadership means you changed what a group did, whether or not you had any authority over them.
Taught in The Consulting Interview · study this deck
Lower credit rating means higher default risk, so investors demand a higher yield.
Taught in Financial Markets & Instruments · study this deck
LTM is the last twelve months of actual results; forward multiples use next year's forecasts, which is what buyers actually pay for.
Taught in Comparable Companies · study this deck
Maintenance covenants are tested on a schedule and a breach hands lenders the right to call the loan.
Taught in Debt, Credit & Leverage · study this deck
Margin is profit as a percentage of revenue, so it can fall even while total profit rises.
Taught in Profitability & Cost Analysis · study this deck
Market cap is share price times shares outstanding, a company's total public equity value.
Taught in Financial Markets & Instruments · study this deck
Marketing is the whole job of matching a product to people who want it, and ads are only the last mile.
Taught in Marketing Fundamentals · study this deck
Mean is the average, median is the middle, mode is the most common — skewed data favors the median.
Taught in Statistics & Data Analysis for Business · study this deck
MECE means your buckets don't overlap and together cover the whole problem, so nothing's double-counted or missing.
Taught in Case Interview Structuring · study this deck
A model is a spreadsheet that turns a handful of assumptions into a projected set of financials.
Taught in Excel for Financial Modeling · study this deck
Monetary policy is the central bank and interest rates; fiscal policy is the government and its taxes and spending.
Taught in Markets & Macro Awareness · study this deck
A multiple is a price per dollar of annual profit, which lets you compare companies of any size.
Taught in Valuation Basics · study this deck
Net income is the thread that stitches the income statement, balance sheet, and cash flow statement together.
Taught in Reading Financial Statements · study this deck
Net income minus dividends is what actually gets added to retained earnings each period.
Taught in Reading Financial Statements · study this deck
A network effect means each new user makes the product better for the existing ones, which is rare.
Taught in Digital & Tech Cases · study this deck
Online is rarely cheaper per order, because delivery and returns are variable while shop rent is fixed.
Taught in Digital & Tech Cases · study this deck
Online revenue is traffic times conversion times basket, and the break is almost always one step of the funnel.
Taught in Digital & Tech Cases · study this deck
Operations is everything a company does to turn inputs into a product a customer actually receives.
Taught in Operations & Supply Chain Management · study this deck
Opportunity cost is the value of the best thing you gave up in order to do the thing you chose.
Taught in Corporate Finance & Investment Basics · study this deck
Organic growth is what the existing business did on its own; reported growth includes what was bought and what exchange rates did.
Taught in Earnings & Guidance · study this deck
A p-value is the odds you'd see a result this extreme if nothing real were actually going on.
Taught in Statistics & Data Analysis for Business · study this deck
A paper LBO is the whole buyout arithmetic done by hand, from entry price to exit equity to returns.
Taught in LBOs & Private Equity Basics · study this deck
A pension deficit is money owed to staff that future cash flows must fund, so add it like debt, net of tax.
Taught in Enterprise & Equity Value · study this deck
Persuasion is scored on whether you understood the other person’s reasons, not on whether you won.
Taught in The Consulting Interview · study this deck
Pocket price is what’s left after every discount and term, and it is rarely close to list price.
Taught in Pricing Strategy · study this deck
The policy rate is the price of money for the whole economy, set by a committee eight times a year.
Taught in Markets & Macro Awareness · study this deck
A prepayment is an asset on the day you pay, and turns into an expense a month at a time.
Taught in Three-Statement Drills · study this deck
Pro forma EPS is £2.23 against £2.00 standalone, so the deal is accretive by 11.5%.
Taught in Merger & LBO Maths · study this deck
Profit is what is left of revenue once every cost of running the business is paid.
Taught in Profitability & Cost Analysis · study this deck
The prospectus is the company’s full public disclosure and the legal basis on which investors buy the deal.
Taught in IPOs & Equity Capital Markets · study this deck
The ratio is 15 ÷ 30 = 0.50, so 20m new shares take EPS to 250 ÷ 120 = £2.08, accretive by 4.2%.
Taught in Merger & LBO Maths · study this deck
Ratios are one snapshot, real credit work is about how durable the cash flow looks under stress.
Taught in Debt, Credit & Leverage · study this deck
Receivables are sales you have not been paid for, payables are bills you have not paid yet.
Taught in Accounting Fundamentals · study this deck
A resume walk is a story about choices, not a list of jobs, and it should end pointing at this seat.
Taught in The Investment Banking Interview · study this deck
Revenue is what customers paid you, profit is what is left after every cost of earning it.
Taught in Accounting Fundamentals · study this deck
A right to win is a specific reason this client beats incumbents, not just a wish to be in the market.
Taught in Growth Strategy & Market Entry · study this deck
Risk-on is money moving into assets that pay more but can lose more; risk-off is money running to safety.
Taught in Markets & Macro Awareness · study this deck
Safety stock is the buffer inventory that absorbs surprise demand spikes or supply delays.
Taught in Operations & Supply Chain Management · study this deck
Sample bias means your data doesn't represent the population you're trying to understand, so conclusions don't generalize.
Taught in Statistics & Data Analysis for Business · study this deck
Sell-side means running a process to sell a company, buy-side means helping a buyer find and buy one.
Taught in M&A Fundamentals · study this deck
Senior debt is paid first and costs least, and equity is paid last but keeps whatever upside is left.
Taught in LBOs & Private Equity Basics · study this deck
The spread is the extra yield a company pays over government bonds for its risk; widening spreads mean the market is getting nervous.
Taught in Markets & Macro Awareness · study this deck
Stock-based comp is an expense that cuts profit, but no cash leaves, so it is added back and lands in equity.
Taught in Three-Statement Drills · study this deck
A supply chain is the full run of hands a product passes through from raw material to end buyer.
Taught in Operations & Supply Chain Management · study this deck
TAM is everyone, SAM is everyone you could serve, SOM is the slice you could realistically win.
Taught in Growth Strategy & Market Entry · study this deck
Technical debt is the cost of every shortcut still sitting in the system, and it is paid in testing.
Taught in Digital & Tech Cases · study this deck
Terminal value covers everything a business earns after the forecast period ends.
Taught in Valuation Basics · study this deck
The test is whether you can hear something unwelcome, take the real point, and change something because of it.
Taught in The Consulting Interview · study this deck
Three points is the most a listener holds in their head, and it feels complete; two feels thin and four feels like a list.
Taught in Synthesis & Structured Communication · study this deck
Cycle time is the gap between finished units and throughput is how many finish per hour.
Taught in Operations & Supply Chain Management · study this deck
The title is the conclusion in a full sentence; if you can write the title, you can say the point.
Taught in Synthesis & Structured Communication · study this deck
Unlevered means debt-free, so you tax EBIT as if no interest existed and let WACC carry the interest tax saving.
Taught in DCF & WACC Drills · study this deck
Vertical integration means owning more of your own supply chain, upstream or downstream.
Taught in Management & Strategy Frameworks · study this deck
WACC is the blended cost of a company's money, part debt, part equity.
Taught in Valuation Basics · study this deck
Willingness to pay is the most a customer would hand over before walking away, and it varies by person.
Taught in Pricing Strategy · study this deck
Working capital is short-term assets minus short-term bills, the cash locked up running the business.
Taught in Accounting Fundamentals · study this deck
A write-down is a non-cash expense: profit falls after tax, cash rises by the tax saved, inventory shrinks.
Taught in Three-Statement Drills · study this deck
Yield is the dividend as a percentage of the share price; payout is the dividend as a share of profit.
Taught in Ratio Analysis · study this deck
No term matches that. Try a shorter word.