Basic principles are widely understood in the financial industry, but the terminology and analytical techniques can vary greatly. This book is written for the nonfinancial shareholders, managers, and oil company employees interested in the forces that influence stock values. The bottom line in any company is expressed in the language of finance. This book explains financial concepts in a nontechnical, practical way so that nonfinancial professionals and others may understand and appreciate this aspect of the business. When the first edition of this book was written, companies disclosed substantially less information than what is available today. This additional information allows a better understanding of the financial status and health of a company. But there is still room for improvement.
This is a thorough and surprisingly readable book. The sections are current, well-written and not overly dry or technical. I, personally, was looking for a cross-section of financial ratios that would show a spectrum of operations from poor to well-run. There were several "case studies" which were well-done, but a little narrow for my purposes.
There is, however, an extensive treatment of oil company Merger & Acquisition financial models and price valuations which I've never seen anywhere, so the book was well worth the price for that section alone. It also included - among the "case studies" - refinery operations of varying sizes and complexities. The "case studies" were actual named refinery operations with "live" financials from 10-K reports, so the numbers were accurate.
Overall, a very good value for the money.
I bought this book because I was interested in investing in ConocoPhillips when the prices of crude oil started to drop in 2008. This book will not teach you everything about the financial analysis of oil companies, but it will teach you enough to understand how oil companies work. And if you are interested in investing in oil companies, you need to understand how these businesses work. There are different ways to value companies, and I found it very helpful that the authors explain how oil companies can be valued by looking at its assets such as reserves, pipelines, tankers, refineries, and marketing outlets.
- Mariusz Skonieczny, author of Why Are We So Clueless about the Stock Market? Learn how to invest your money, how to pick stocks, and how to make money in the stock market
As a professor of economics and project finance I find that this book is a valuable specialized book on the field of analysis and valuation of oil companies. Check the MacKinsey bible on valuation and verify that Mr Johnston's book goes as far as it is possible without making it unreadable for the average reader interested in this subject. It is obvious that the type of very specialized information that the harsh reviewer above asked for would not be included in this type of book as its audience would be very limited.
Product Details :
- Hardcover: 500 pages
- Publisher: PennWell Corp. (October 15, 2005)
- Language: English
- ISBN-10: 159370044X
- ISBN-13: 978-1593700447
- Product Dimensions: 1.1 x 6.3 x 9.1 inches
More Details about Introduction to Oil Company Financial Analysis, 1st Edition
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