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Comprehensive multiples valuation

Abstract

The following chapter shows how to utilize multiples to yield proper estimates of a firm's fair value. It starts with a description of the four-step valuation process of the standard multiples valuation method. Based on an evaluation of the strengths and weaknesses of the standard approach, I present extensions to any of the four valuation steps and develop answers to research question 1 and 2. The final part of the chapter examines the usefulness of combining information from book values and earnings into a two-factor multiples valuation model from a theoretical point of view (research question 3).

Keywords

Cash Flow Capital Structure Free Cash Flow Target Firm Income Statement 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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© Deutscher Universitäts-Verlag | GWV Fachverlage GmbH, Wiesbaden 2007

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