Glossary
Comparable company analysis (comps)
Valuing a company by applying the multiples of similar companies to its own figures.
The method selects a peer set, chooses a multiple that suits the business (EV/Revenue for early-stage software, EV/EBITDA for mature, profitable companies) and applies the peer range to the target’s own figure.
The result is only as good as the peer set. Peers that differ in growth, margin, scale or business model distort the range, and private targets are usually discounted for illiquidity against listed peers.
In Hebrides
Comparables builds the peer set from the data room and checks each candidate against what the company does, marking it as a direct competitor, adjacent or not comparable.
Comparables