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Best Financial Modeling Books

A list of the best books to learn financial modeling in Excel

What are the Best Financial Modeling Books?

The best way to learn financial modeling is through practice. But how can you practice if you don’t know where to start? Many people start with video-based training (which we offer extensively), while others still prefer good old-fashioned books. For anyone who prefers to learn by reading and studying from books, this is the place for you. We’ve compiled in this guide what we believe are the eight most important and helpful financial modeling books.

If reading is your preference, we recommend supplementing these books with our video-based courses so that you can watch an instructor build a financial model step-by-step in Excel.

 

Financial modeling books

 

List of the Best Financial Modeling Books

 

1. Mastering Financial Modelling in Microsoft Excel – Alastair Day

Alastair Day’s book is an excellent one for anyone looking to master financial modeling in Excel. The author does a great job of making complex issues simple and easy to understand, which makes the book highly recommended.

The main topics covered in Day’s financial modeling book include:

  • Spreadsheet design, methodologies, and processes
  • Techniques for checking and improving existing models
  • How to avoid costly mistakes by testing each scenario
  • Which Excel formulas and functions to use for different things, and how to discover new variables

 

Check out our free financial modeling guide on modeling best practices!

 

2. Financial Modeling in Practice: A Concise Guide for Intermediate and Advanced Levels – Michael Rees

Rees’ book easily made our list of the best financial modeling books. It is very engaging, easy to read, and some of the most interesting and important topics covered in it include:

  • Excel functions and the tools that are particularly relevant to financial modeling
  • How to design, structure, and build models that are relevant, accurate, and easily understandable
  • Modeling and linking the 3 financial statements
  • Add-ins such as @RISK and PrecisionTree for risk modeling
  • How VBA can be used in a range of practical financial modeling situations

 

financial modeling video
Check out CFI’s financial modeling courses online.

 

3. Best Practices for Equity Research Analysis – James Valentine

James Valentine’s book is a classic and, therefore, makes the top three on our list. Geared toward equity research, the book provides extremely practical and helpful advice for anyone who wants a career in that field. It includes:

  • Material on valuation, due diligence, and behavioral finance
  • The author’s own experiences working with Excel, which adds more depth to the material
  • Information on the importance of clear communication
  • How to relate to the management of covered companies
  • Excel tips and tricks (covered extensively in this book)

 

4. Financial Analysis and Modeling using Excel and VBA – Chandan Sengupta

Number four on our list of top financial modeling books is by Chandan Sengupta, who dives into the world of VBA as it relates to Excel models. If want to learn how to incorporate VBA into your models, Sengupta’s book is definitely for you! Key highlights include:

  • Features of Excel that are essential for financial analysis and modeling, such as the Ribbon, PivotTables, data analysis, and statistical analysis
  • Financial analysis and modeling, and advanced features of Excel and VBA, taught by using a step-by-step, “hands-on,” learn-by-doing approach
  • Learning how to efficiently write formulas to answer what-if questions and find iterative solutions to problems
  • How to make the most of Excel and VBA methods

 

5. Financial Modeling – Simon Benninga

Another classic on the must-read financial modeling books list. Benninga’s book is 100% focused on one thing: financial modeling. If you want to fully round out your skills and become a genuine Excel “master,” we highly recommend this book. Key points include:

  • Using Excel software to solve finance problems
  • Examples used in the book draw on actual company data
  • Tips on obtaining current data from the internet
  • Concepts relating to modern corporate finance, investments, and derivatives

Financial modeling example
Learn financial modeling with CFI’s online financial modeling courses.

 

6. A Practical Guide to Investment Banking and Private Equity – Paul Pignataro

This book has a unique angle to its approach, which is helpful for those targeting careers in investment banking, or aspiring to work in private equity or hedge fund management. You won’t be disappointed if you take the time to read this book!  Some highlights include:

  • Overview of key fundamentals of investment banking, private equity, and the M&A process
  • A step-by-step method for analyzing companies for M&A deals
  • Financial statements and valuation methods used in mergers and acquisitions
  • Handbook for investment banking professionals and business students looking to get into the field
  • Goes through the model building and valuation process in extensive detail

 

7. Financial Modeling for Business Owners and Entrepreneurs – Tom Y. Sawyer

Tom Sawyer’s Excel guide is perfect for business owners, high-level company executives, and managers. It incorporates financial modeling with basic business principles and business plans and provides step-by-step methods for handling specific business problems. Among the key highlights of this book are all of the following:

  • How to connects business planning with a financial model in a simple and direct manner
  • Designed to serve entrepreneurs and small business owners
  • Learn how to easily formulate and test various hypotheses and assumptions of your business model
  • Offers a simple, straightforward method for creating plans and analyzing different possible paths for a startup financial model
  • Keys in on how to maintain a project management perspective that will help you continually focus your time and energy on the most relevant/urgent tasks for efficiently growing your business

 

8. Building Financial Models – John Tjia

John Tjia’s book provides readers with sound knowledge of how to use Excel tools to create robust financial models that are easy for users to understand. In other words, it’s excellent for learning how to put together clear, persuasive presentations. It walks you through how to develop a projection model, dedicating individual chapters to each phase of the process. The key components of the book include the following:

  • Projection models – What they are, how they are used, and how they can vary between industries
  • Accounting and finance concepts that underpin working financial models
  • Detailed directions for using spreadsheet software to create dynamically powerful financial models
  • Producing and designing a projection model that allows the user to change inputs quickly for sensitivity analysis

 

More Financial Modeling Resources

We hope this has been a helpful guide to the best financial modeling books for learning how to build models on your own. Additional CFI resources that you may find helpful include:

  • Free Financial Modeling Guide
  • How to Be a Great Financial Analyst
  • Financial Modeling Skills
  • Types of Financial Models

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Become a certified Financial Modeling and Valuation Analyst (FMVA)® by completing CFI’s online financial modeling classes and training program!