Model 09-01

Comparable Companies or Transactions Valuation Method

Example A
Panel A: Company W Is Compared with Companies TA, TB, and TC
Ratio
Enterprise market value/revenues
Enterprise market value/EBITDA
Enterprise market value/free cash flows

Company TA
1.4
15
25

Company TB
1.2
14
20

Company TC
1.0
22
27

Average
1.2
17.0
24.0

Panel B: Application of Valuation Ratios to Company W

Actual Recent Data for Company W
Revenues
EBITDA
Free Cash Flows

= $100
= $7
= $5

Average Ratio
1.2
17.0
24.0
Average =

Indicated Enterprise Market

Value
$120
$119
$120
$120

Example B
Panel A: Company W Is Compared with Companies TA, TB, and TC
Ratio
Enterprise market value/revenues
Enterprise market value/EBITDA
Enterprise market value/free cash flows

Company TA
3.5
22
10

Company TB
1.2
14
30

Company TC
5.0
15
14

Average
3.2
17.0
18.0

Panel B: Application of Valuation Ratios to Company W

Actual Recent Data for Company W
Revenues
EBITDA
Free Cash Flows

= $100
= $7
= $5

Average Ratio
3.2
17.0
18.0
Average =

Indicated Enterprise Market

Value
$323
$119
$90
$177