What is comparable company analysis?

Business & Management
#1

A comparable company analysis is a method of determining a firm’s worth by comparing it to other firms of similar size in the same industry. The idea behind comparable company research is that similar firms will have similar valuation multiples, such as EV/EBITDA. Analysts prepare a list of accessible data for the firms under consideration and compute them, In order to compare them, you’ll need to know their valuation multiples.