Which valuation method will always generate the highest valuation no matter what (trade comps, transaction comps, DCF)? (Received this question in an IB interview)
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Trick question - they can all produce the highest or lowest value depending on assumptions. But generally precedent transactions because of premium paid
Yeah this is correct. The other main reason is in a DCF or LBO you have a target return you are trying to hit and are backing into a valuations based on that return.
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