Module II· Trading ComparablesAdvanced
Question
Which five most common comps mistakes must you avoid in an interview?
Answer
- A comp set that's too large and heterogeneous − a median with no signal.
- Inconsistent net-debt definitions (Bloomberg default vs. manual adjustments) − distorted EV.
- Mean instead of median − outlier-distorted.
- LTM instead of NTM EBITDA − backwards-looking.
- Ignoring the growth gap between target and comp median − mis-application of the multiple.
Deep diveShow more details
Pitch tip
If an MD asks 'Where could your comps go wrong?', list these five. Bonus: 'I also check multiple stability historically — if the sector multiple was 30% lower 6 months before the pitch, I question the current valuation.' A top-quartile answer, signaling critical understanding.