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Building a comparable company analysis

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Which of the following statements is most correct about building a comparable company analysis?

A) It is never appropriate to include the target company in the peer group.

B) Using the peer group's average multiple is preferable to using the peer group's median multiple when you suspect significant outliers.

C) When EBITDA forecasts are available, share price valuation using EV/next year EBITDA is always preferable to valuation using EV/LTM EBITDA.

D) Comps analysis is preferable to the DCF for valuing the share price of public companies because the market is providing a clear valuation signal.

E) Valuing the share price of a company based on the P/E of its peers is not as useful as valuing based on the EV/EBITDA of its peers when the target and peer group have widely differing leverage.

Reference no: EM133001432

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