Project Calloway — Four-Hour Take-Home & Two-Page Memo
A 4-hour Timed Take-Home / Investment Memo case study with a complete model answer
Modeled After
Balyasny Asset Management
Balyasny's reported investment-analyst case study: a four-hour timed take-home on a single consumer name, any resources permitted, producing a model and a two-page investment memo, followed by interviews in which the candidate defends the work.
Structure and exercise format are modeled after Balyasny Asset Management — the case-study format the firm is reported to use. The company, the financials and every figure in this case are entirely our own.
The Situation
Calloway Beverage Corporation (ticker CALW) makes and sells ready-to-drink functional beverages. It runs two product lines — a core line in cans, and a zero-sugar and functional line that carries a higher list price and a higher gross margin — through United States grocery, convenience, club and drug retail, and it has distribution in three international markets with a fourth announced.
Calloway Beverage Corporation
- Sector
- Consumer staples — ready-to-drink functional beverages, sold in two lines: a core line in cans and a higher-priced zero-sugar and functional line
- Size
- Geography
- United States grocery, convenience, club and drug retail, plus Canada, the United Kingdom and Mexico, with Germany announced on March 3, 2026 and first shipments guided to FY2027E
- Ownership
- Situation
The Prompt
m.
Supporting Materials
What you are handed at the start of the case, in the format a real process would use.
The exercise email and what comes with it (material-1.pdf)
Calloway FY2025 disclosure extract (material-2.pdf)
Market data extract (data-1.xlsx)
Blank workbook template (template.xlsx)
What You Have to Produce
The deliverables, in the order the committee will read them. The exercise runs 240 minutes.
PART 1
North America — volume from three drivers, and price from the list less the give-back
PART 2
The price, volume, mix and trade bridge — and make it close
PART 3
International — four markets, built separately
PART 4
The income statement — both earnings definitions, on one page
PART 5
Free cash flow, the buyback and the share count
PART 6
Valuation — one route, one cross-check, and the gap stated rather than averaged
PART 7
Run the multiple backwards — what the price already discounts
PART 8
Scenarios and sensitivities — designed, not defaulted
PART 9
What four hours did not buy
PART 10
The memo — two pages, and the limit is real
How to Approach It
The order a strong candidate works in, and why. This is the shape of the answer — the finished memo and Excel model are in the solution set below.
- 0:00 – 0:25
read in, and decide what you are not going to do
- 0:25 – 1:00
North America and International
- 1:00 – 1:15
the bridge, and do not leave it until it closes
- 1:15 – 1:50
the income statement, then cash and the share count
- 1:50 – 2:20
the valuation, and then run it backwards
- 2:20 – 2:45
scenarios and both grids
- 2:45 – 3:00
price three things, name the rest
- 3:00 – 4:00
the memo, and ring-fence the whole hour
Key Concepts
The ideas this case is built on. Know these cold and the case becomes a question of execution rather than knowledge.
Distribution gains and velocity are different quantities and can disagree
Doors, facings per door and cases per facing per year multiply to volume, and the first two can rise while the third falls. There is a structural reason: a brand wins its best accounts first, so each incremental door turns the product more slowly than the average door already carrying it, and the drag strengthens as penetration rises. This is the central mechanic of consumer distribution and it is invisible to any model that grows volume off a single rate. Building the three rows separately is the difference between a model that can be interrogated and one that can only be believed.
List price is not net price, and trade spend is where the difference lives
Trade promotion and allowances are what a beverage company pays a retailer for shelf space, end-caps and features. They sit between the list price management quotes and the net price the company collects, and when they are rising a share of every announced price increase is being handed back. Compound the list prices, the weighted gross price and the net price and rank them: the ordering tells you whether mix is outrunning the give-back or the other way round, and it is a two-sentence observation that no revenue growth rate can produce.
Any multiple has to declare what is in the earnings
Calloway's Adjusted EBITDA adds back stock-based compensation and new-market entry costs. Both are arguable and neither is obviously one-time — the equity plans are how the company pays the people who run its plants, and it has opened a new international market in three of the last six years while saying it intends to keep doing so. What is not arguable is that a multiple struck on one basis and calibrated on another double-counts or under-counts, and that a memo which does not say which basis it used cannot be checked. Declare it, and be consistent between the earnings line and the share count.
A buyback is a share-count mechanic, not a valuation one
When most of free cash flow is returned through repurchases, the share count is a live part of the earnings build rather than a constant. The first tranche of every year's repurchase only settles the shares the equity plans issue — it spends cash without shrinking the count — and only the remainder compounds earnings per share. Charging the expense in the earnings and then diluting the count as well charges one instrument twice; ignoring the cash cost lets it go free. Both errors are common and both are visible in the share roll.
Inverting the multiple beats arguing about it
Holding your own target multiple and your own return bar and solving for the earnings the current price is paying for converts a valuation opinion into an arithmetic claim. Pushing that number back through the model into the driver it lands on converts it into an operating claim, which is a far harder thing to dismiss. Where earnings are linear in a driver — as they are here in cases per facing per year — the inversion is a two-point secant rather than a search, and a third column re-running the full build at the answer proves the linearity held rather than assuming it.
A payoff ratio and an expected return are not the same test
Upside to the bull over downside to the bear is a ratio that ignores probability entirely. A probability-weighted value uses it and nothing else. They routinely disagree, and when they do the memo has to reconcile them rather than quote whichever is flattering. A wide, favorable payoff ratio on a distribution whose weight sits in the bear tail is exactly the shape that talks people into positions they should not hold.
Scope control is an analytical skill, not a time-management one
Deciding what not to build is a judgment about what moves the answer, and it is graded here as heavily as the arithmetic. Naming what a model leaves out is worth more than pricing one more thing, and claiming to have priced everything is worth less than saying nothing at all. An omissions list has to be short, ranked and specific — twenty items reads as insurance against being wrong rather than as a work plan.
Two pages is a constraint on thinking, not on typing
A hard page limit forces a decision about what the argument actually is. The boxed recommendation — the call and the headline reason with a price attached, where the price sits against your value, what the evidence says, what drives the gap, the counter and why you are not persuaded — is about two hundred words, and a candidate who cannot write it in that space usually has not decided what they think. A two-page memo with twelve pages behind it has defeated the exercise.
What Makes It Hard
The specific traps in this case — the places candidates lose the assessment without noticing.
Check Your Answer
Type the figures you produced and find out how many are right before you open the worked answer. You get a verdict and, where you are off, a pointer to the part of the build to re-check — never the number itself. Everything you type stays on this device.
How to type a figure. Digits, with an optional unit: 1,234.5, $1,234.5, 2.6x, 21.4%. For a negative use (20.0) or -20.0. Enter as many decimals as you carried — precision is never penalised.
What the Case Asked For
The arithmetic is only half of it. Tick off what you actually produced — this half is yours to score, because nothing can grade a written recommendation from a checkbox.
The Model Answer
The worked answer in full: memo and Excel model, built the way a banker would actually build them. It is a reference, not a submission — a strong answer under the clock is far shorter.
What the Solution Covers
- —Scoping a model to a four-hour clock
- —Consumer volume and price/mix build
- —Distribution and international expansion
- —Two-page memo discipline
- —Scenario and sensitivity design
- —Saying what you did not have time to do
Memo
The written recommendation and how it was reached
Upgrade to Diamond
Sign up and upgrade to Diamond to unlock the memo, the Excel model and the audio walkthrough.
Get StartedThe Excel Model
The model is linked and tied out end to end — every schedule, every formula and every check, in the file itself.
Downloads are available to Diamond members
Excel Model and Memo (PDF) — yours to open, edit and rebuild
Walkthrough
A conversational walkthrough of how to approach the case under time pressure — where to start, what to cut, and how the recommendation gets defended.
Audio Walkthrough
How to approach Project Calloway — Four-Hour Take-Home & Two-Page Memo
60-second preview — upgrade to Diamond for the full walkthrough
Frequently Asked Questions
Is this a stock pitch or a modeling test?
Both, and the balance between them is scored. The model exists to make one or two sentences in the memo defensible, not to be admired on its own. A workbook that ties with a memo written in the last twenty minutes scores worse than a slightly thinner workbook with an hour behind the writing. The Cover of the template prints the split it assumes: 40 minutes reading in and checking, 140 on the workbook, 60 on the memo, so that a candidate who blows through it can see what it cost.
Why is there no discounted cash flow?
Because four hours does not buy a defensible one. A terminal-value-driven valuation on a company whose terminal margin is the open question would be the least reliable number in the file, and building it badly is worse than naming it as work not done. That decision is itself part of the answer, and the case expects it to be stated rather than left as a gap.
The forward multiple looks high. Isn't the stock already expensive, which makes this easy?
The multiple is high, and that is not the argument. Plenty of companies deserve a high multiple. The argument that survives a Q&A is the operating one — what the price requires the business to do, expressed in a physical quantity the company reports — because it can be tested against the next disclosure rather than debated. Run the multiple backwards before you argue about its level.
Am I supposed to forecast the drivers myself?
No. The plan drivers are given so that every submission is comparable and so that the four hours can go where the grading is. What you supply is the judgment: the target multiple and the cross-check multiple, the design of both sensitivity grids, the bear and bull driver sets and their weights, and which stresses are worth sizing. Those cells are blank in the workbook because they are the exercise.
How long should the memo actually be?
Two pages, and the limit is enforced rather than encouraged — the email says that if it runs to three, the first two are what get read. In practice that means the recommendation goes in a box at the top, the evidence sits behind it in the order that supports it, and the omissions section closes it. Anything that does not earn its place on those two pages does not go in an appendix; it goes.
Should I name a price I would buy at, or is a pass enough?
Name the price. A memo that says pass has told the reader what you would not do; a memo that names the price at which you become a buyer has told them what you think the thing is worth, which is more useful and much harder to write because it commits you. It also falls out of the arithmetic you have already done, so there is no excuse for leaving it out.
What if I run out of time before the scenarios and the grids?
Then say so in the memo and say what you would have found. A candidate who reaches the valuation, inverts it, writes two clean pages and names the three things they did not get to is in far better shape than one who fills every cell and hands back four paragraphs. The exercise is a test of what you choose to do with four hours, and choosing well includes choosing to stop.
Does the fact that the shares are well off their high help the case for owning them?
Check it before you use it. A large drawdown from a high tells you about the path, not about the level, and the level here has to be measured against the company's own history and against what comparable businesses trade on. Both references are in the market-data extract, and one of them is not screened, which is itself worth a sentence.
About This Timed Take-Home / Investment Memo Case Study
Timed Take-Home / Investment Memo case study for hedge fund interviews. 240-minute format covering scoping a model to a four-hour clock, consumer volume and price/mix build, distribution and international expansion. Includes the full prompt, a written memo, a tied-out Excel model and an audio walkthrough.
This case study sits in Hedge Fund, under Timed Take-Home. Every case ships with the full prompt, the supporting materials, a complete model answer and an audio walkthrough of the judgment behind the recommendation.
240-Minute Format
The time limit a real assessment would give you
Memo
Included in the model answer
Excel Model
Included in the model answer
Audio Walkthrough
How to approach the case under time pressure
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