Module VI· Football Field BuildIntermediate
Question
How do you construct high / low ranges for each valuation method?
Answer
Use method-specific drivers: WACC and terminal assumptions for DCF, quartile multiples for trading comps, precedent transaction ranges for M&A, exit multiple and IRR for LBO, and observed prices for market ranges. Avoid arbitrary ranges. Each bar should be traceable to a sensitivity or selected peer / transaction set.