Investment Banking interview preparation

Questions

100

Traced to a firm

100

Firms

46

Updated

September 2026

Asked at

All firmsTSTruist Securities10Rothschild & Co8Centerview Partners7CSCredit Suisse7HWHarris Williams6Houlihan Lokey6Lazard6Mizuho6Barclays5Citi5Deutsche Bank5Evercore5Moelis & Company5MSMorgan Stanley5Piper Sandler5RCRBC Capital Markets5Goldman Sachs4Nomura4TD Securities4Bank of America3GSGuggenheim Securities3J.P. Morgan3Jefferies3Moody's3Perella Weinberg Partners3WPWarburg Pincus3WBWilliam Blair3HSBC2Lincoln International2Scotiabank2TPTPG2UBS2Wells Fargo Securities2Advent International1Apollo Global Management1Bain Capital1Balyasny Asset Management1BLBlackRock1BPBNP Paribas1General Atlantic1Invesco1Morningstar1PIMCO1STSociété Générale1SSState Street1WMWellington Management1

Topic

All topicsAccounting14Valuation21M&A10Markets and deals10Capital markets3LBO8Leveraged finance3Restructuring2Credit3Debt capital markets2Capital structure2Case and estimation11Brainteasers6Fit5

Level

AnyCoreIntermediateHard

Type

AnyTechnicalCaseBrainteaserFitMarket view

1. 016What are the main drivers or sensitivities in a DCF?ValuationIntermediatetechnicalTD SecuritiesInvestment Banking · New York · 2026Moelis & CompanyInvestment Banking · New York · 2026

   Say this

   The discount rate and the terminal value assumption, by a wide margin. After those, the revenue growth and margin path in the forecast years, then CapEx and working capital intensity.

   Then walk it

   1. WACC dominates because it compounds. A 100 basis point move in WACC can swing value 15 to 20 percent for a long-duration business.
   2. Terminal value is the other big one, since it is usually 60 to 80 percent of enterprise value. A 50 basis point change in perpetuity growth moves the answer materially.
   3. Inside the forecast, margin matters more than revenue for most mature businesses, because a margin point drops straight to cash.
   4. CapEx and working capital intensity matter most for capital-hungry or fast-growing companies, where growth consumes cash.
   5. The standard output is a two-way sensitivity table, WACC against exit multiple or against perpetuity growth. That grid is what actually goes in the deck, not a single point value.

   Where candidates lose it

   Listing revenue growth first. It feels intuitive but it is wrong for most businesses; discount rate and terminal value swamp it. Also, saying 'a DCF gives you the intrinsic value' as if it were one number, rather than a range you present as a football field.

   Expect next

   • Given a $10 change in revenue, COGS, or CapEx, which has the biggest impact?
   • How do you pick the perpetuity growth rate?
   • What would you do if the DCF value is miles above the trading price?

   Reported by candidates at TD Securities (Investment Banking, New York, 2026); Moelis & Company (Investment Banking, New York, 2026). Source: Wall Street Oasis.

2. 061Does PIK financing increase or decrease enterprise value?Leveraged financeHardtechnicalMoelis & CompanyInvestment Banking · Los Angeles · 2026

   Say this

   Neither, directly. Enterprise value is set by operating cash flows, and how you finance the business does not change them. PIK changes the split between debt and equity, and it grows the debt claim over time because the interest accrues.

   Then walk it

   1. PIK means pay in kind: the interest is not paid in cash, it capitalises onto the principal. So the debt balance compounds upward.
   2. Enterprise value is unaffected in theory, because EBITDA and cash flow are unchanged. Financing does not create operating value.
   3. What changes is the bridge. Net debt grows every year as interest accrues, so at a constant enterprise value the equity value shrinks over time. The equity is being eaten from below.
   4. The genuine second-order effects: PIK preserves cash today, which can fund growth and therefore raise EBITDA, so it can indirectly support value. And PIK accretion may not be cash-tax deductible in the same way, which weakens the tax shield.
   5. The practical reason it exists: it lets a struggling or fast-growing borrower avoid a cash interest burden it cannot currently service. It buys time and it is expensive. If the business does not grow into it, the accreting balance is what wipes out the equity.

   Where candidates lose it

   Saying enterprise value falls because debt went up. Debt is not part of enterprise value; it is part of the bridge to equity. Confusing the two here is the exact error the question is designed to expose.

   Expect next

   • How much would you pay for 2x your money on a 12 percent PIK with no compounding?
   • So what happens to the equity value over the hold?
   • When would a lender insist on PIK?

   Reported by candidates at Moelis & Company (Investment Banking, Los Angeles, 2026). Source: Wall Street Oasis.

Firm tags come from public, anonymous candidate reports on Wall Street Oasis: strong signal, not sworn testimony. Firms are named as the places a question was reported, not as partners of Fin Maverick. Answers are written for this page to show how to think out loud; they are not scripts to recite.