Valuation: Comps & Precedents
When is P/E (an equity multiple) actually the right multiple to use, despite the leverage problem?
Model answer
P/E is appropriate for financial institutions - banks and insurers - where (a) interest is a core operating item, not just financing (a bank's liabilities ARE its business), so EBITDA and enterprise…
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More from Valuation: Comps & Precedents
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