Perhaps nothing in valuation theory is less understood and more manipulated than the wide arrange of valuation multiples used to measure value and extrapolate value onto supposedly comparable opportunities. It has often been pointed out that a stock chart can be created on an individual security or index to support the creator’s argument simply by…
Category Archives: Corporate Valuation
Understanding the Basics of Valuation Multiples
Valuation multiples have a firm and detailed analytical basis underlying the basic calculations most investors like to throw around when discussing relative entity value. I could take you through the hard core, and surprisingly complex, mathematics responsible for generating various multiples – but then I would bore you to tears and miss instilling a basic…
