InterviewSolution
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Rank The 3 Valuation Methodologies From Highest To Lowest Expected Value. |
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Answer» there is no ranking that always holds. In general, Precedent Transactions will be HIGHER than Comparable Companies due to the Control Premium built into acquisitions. Beyond that, a DCF could go either way and it's best to say that it's more VARIABLE than other methodologies. Often it PRODUCES the highest value, but it can PRODUCE the lowest value as well depending on your assumptions. there is no ranking that always holds. In general, Precedent Transactions will be higher than Comparable Companies due to the Control Premium built into acquisitions. Beyond that, a DCF could go either way and it's best to say that it's more variable than other methodologies. Often it produces the highest value, but it can produce the lowest value as well depending on your assumptions. |
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