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M&A Valuation Methods: Your Essential Guide with 7 Key Methods

Valutico

These ratios, like the EBITDA multiple, compare a company’s financial performance (EBITDA, revenue, etc.) to its market value. These multiples are applied to target company’s latest financials such as revenue, earnings and book value of equity to arrive at an estimate of enterprise value or equity value.

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M&A Terms Every Business Owner Should Know

Class VI Partner

Discount Rate Discount Rate refers to the rate at which a stream of future cash flows is discounted to determine Net Present Value. EBITDA Multiple EBITDA Multiple refers to the multiple of EBITDA used to determine a company’s enterprise value.