I don't understand exactly why one would add 0.5 to the final year discount number for the multiples method, but would leave the gordon growth method's final year discount number as is..
| +131 | New Article: Dramatic Slide as UBS #22 (US) & New Leadership Desperately Needed | 25 | 14h |
| +113 | Americas M&A League Table Q2 Updated | 53 | 3h |
| +75 | Wealthy Parents / Jaded | 24 | 1d |
| +59 | How are hours rn for SA (interns) | 31 | 1d |
| +58 | A COMPLETE GUIDE TO SUMMER INTERNSHIP RECRUITING | 11 | 1d |
| +42 | Boutique firm wants access to my LinkedIn? | 37 | 2h |
| +33 | Investment Banking in Mexico | 9 | 1d |
| +30 | Investment Banking is Hard | 13 | 2h |
| +23 | Restructuring: Anti-climactic Experience | 3 | 4h |
| +21 | Excel macros for QOL formatting | 0 | 4d |
Career Resources
Get instant access to lessons taught by experienced private equity pros and bulge bracket investment bankers including financial statement modeling, DCF, M&A, LBO, Comps and Excel Modeling.
The point of the mid-year convention is to show the assumption that a company's free cash flow is received evenly throughout the year. When using GGM you continue to use the mid-year convention because you are still discounting your perpetual free cash flow which you assume is coming in throughout the year.
In the multiples exit method you are not showing free cash flow throughout the year, you are showing an EV/EBITDA etc multiple, so it doesn't make sense to use a midyear convention. Make sense?
Expedita odit repellat vel id neque et. Temporibus id fuga aspernatur dolorem mollitia voluptatum occaecati quos. Est assumenda alias sed quia et sequi vero. Quia et eum dolores corrupti provident.
Eveniet maiores est aut. Atque sapiente et qui modi aliquid. Voluptates sit enim sint itaque vel voluptas occaecati.
Reiciendis minima ducimus maxime odio. Asperiores laborum ut expedita quo rem. Deserunt vero et suscipit vel.
Nihil quia sunt quam adipisci facilis. Consequatur veniam iste quidem tempora itaque. Libero deserunt assumenda voluptas. Ipsa quo quos ducimus. Rerum esse officia impedit beatae dicta iste assumenda. A labore illo architecto non totam unde. Hic dolores dolor quo quam et.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...