Module II· Trading ComparablesIntermediate

Question

How do you build an initial comp universe for a middle-market industrial target?

Answer

Steps:

Identify the target's GICS or NACE code.
Bloomberg/CapitalIQ screen: same industry + region + market-cap range (0.3x−3x of target EV).
Generate a long list (15−25 companies).
Manual filtering: exclude pure-plays with too different a business structure, distressed comps, and holding structures.
Final 8−12 comps.
Tier classification (Tier 1 = closest, Tier 2 = broader). Middle-market tip: for middle-market targets without enough regional comps, widen the universe to a broad regional index (e.g. STOXX Europe 600 industrials), with an explicit note in the pitch.

Deep diveShow more details

Pitch tip

Document the comp-set logic explicitly on the pitch slide (selection criteria, exclusions) — otherwise every senior will question it.

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