Transaction Multiples
What are Transaction Multiples? Transaction Multiples are a type of financial metrics used to value a company. In an M&A deal, the valuation of a particular company is done by various methods, including discounted cash flow and multiples. Among the different methods, Transaction Multiples play a very different role, as they make the buyer aware...
PEG Ratio
What is the Price/Earnings to Growth (PEG) Ratio? The PEG ratio is a company’s Price/Earnings ratio divided by its earnings growth rate over a period of time (typically the next 1-3 years). The PEG ratio adjusts the traditional P/E ratio by taking into account the growth rate in earnings per share that are expected in...
Term Sheet Guide
Term Sheet Overview A term sheet is a written document the parties exchange containing the important terms and conditions of the deal. The document summarizes the main points of the deal agreements and sorts out the differences before actually executing the legal agreements and starting off with the time-consuming due diligence. The term sheet is...
Multiples Analysis
What is Multiples Analysis? The multiples analysis is a valuation technique that utilizes different financial metrics from comparable companies to value a target company. Thus, the assumption is that the relative value of certain financial ratios can be used to rank or value a company within a similar group. Despite being the oldest technique in...
M&A Considerations and Implications
M&A – Top Considerations and Implications In M&A transactions, there are several important factors that executives, investment bankers, and other stakeholders have to consider, including: Form of consideration (cash vs. shares) Accounting implications Tax treatment Synergies Strategic rationale Intangibles 1. Form of consideration for the M&A deal In order for a company to consider a...
