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Self-Study

Relative Valuation

Along with accounting, relative valuation is an  essential foundation for anyone performing valuation work. This Course Pack covers two topics in one complete package. What is the relative value of Apple versus Microsoft? That type of question is addressed in the discussion around public comparables analysis. If Apple was hypothetically interested in acquiring a rival firm, what would be a fair price to pay? We then discuss acquisition comparables to analyze precedent transactions. The Course Pack also includes Excel models for both types of analysis.

Topics Coveredrelative-valuation-book - JPEG webiste

  • Foundations of public comparables
  • Foundations of acquisition comparables
  • Normalizing and adjusting the income statement
  • Adjusting for restricted stock and restricted stock units
  • Complications such as dual share structures and foreign listed shares
  • How preferred stock, equity in affiliates, noncontrolling interest, and pensions affect valuation
  • Summarizing valuation through a Football Field or floating bar chart

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