Which Valuation Technique for each sector in Equity Research
As the title implies, which valuation technique are generally more useful for each sector? More specifically, if one were to interview for an associate position and were asked the sector that most interests them, I presume they'd then be asked something along the lines of the type of valuation technique that would be utilized. I have seen a few posts on the topic in the investment banking forum, but they didn't really cover all sectors and I didn't know if the approach would be different in ER than in IB. I have attached a pdf of different valuation techniques for different sectors that was posted by @WallStreetPlayboys a few years ago, but is this pretty much accurate?
| Attachment | Size |
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| valuation_by_sector.pdf 22.69 KB | 22.69 KB |
The type of valuation that my group uses isn't listed with my sector on that PDF.
Are you interested in a particular sector? Maybe if you say what it is somebody could tell you what their group uses.
Specifically the sectors I am most interested in (though I know it is a bit of an eclectic bunch) are FIGs, Industrials (particularly Aerospace and Defense), restaurants, and retailers. I am particularly interested in FIGs and Industrials though. If you have any particular knowledge of any of those that would be really helpful!
Restaurants and retail use P/E or EV/EBITDA (or EBITDAR if leasing rather than owning)
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