Investor Relationship Executive Interview Questions and Answers

Relative valuation involves comparing the valuation of companies within the same sector to determine their relative value.

• Identify comparable companies within the same sector

• Calculate key valuation metrics such as P/E ratio, EV/EBITDA, and PEG ratio

• Compare the valuation metrics of the target company to its peers to determine if it is undervalued or overvalued

• Consider industry-specific factors that may impact valuation multiples

• Adjust valuation multiples based on differences i...read more

Valuation methods include market approach, income approach, and asset-based approach.

• Market approach: Compares the company to similar publicly traded companies.

• Income approach: Estimates the value based on the present value of expected future cash flows.

• Asset-based approach: Calculates the value based on the company's assets and liabilities.

• Discounted Cash Flow (DCF) method: Estimates the value based on the company's projected cash flows and discount rate.

• Comparable Company A...read more