Determine Valuation for Private/Public Companies
Hi,
I just finished the first two chapters of Rosenbaum/Pearl (i.e. Trading Comps and Transaction Comps). So far, three techniques to actually determine a valuation have been introduced:
- How a given EV/EBITDA multiple range translates into implied share price.
- How a given P/E ratio range translates to implied share price
- How a given P/E ratio range translates to implied EV (see attachment)
To my knowledge, later chapters will discuss the valuation of private companies. But given the three ways listed above, would 1, 2 and 3 apply for the valuation of public companies, whereas only 1 could be used for valuing a private one (i.e. up to column "Implied Equity Value")? Hope this isn't too basic.
Best,
Hanso6
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