Research Of Comparable Company Selection And Value Multiplier Correction In Comparative Way Of Listed Companies

Comparative way of listed companies is a commonly used method in company value assessment.It refers to the specific method that obtaining and analyzing the operating and financial data of comparable listed companies,calculating the appropriate value ratio,and determining the value of the assessment object based on the comparative analysis with the evaluated company.The most important two steps in the comparative method of listed companies are comparable company selection and value multiplier correction.Comparability of comparative method for listed companies is divided into business comparability and finance comparability.Comparable business refers to target firm with listed companies in the same industry,providing products and services is the same,the customer is the same as the terminal market.Comparable financial refers to target firm with listed companies in the quality of a share,profit ability,debt paying ability,operation ability,development ability.In this paper,on the basis of business comparability,the choice is closely related to the share price of financial indicators to establish scale,in order to choose the best comparable companies.Value multiplier is the ratio of enterprise value and a financial or non-financial indicator.There are differences between target firm and listed companies.So we can't directly use value multiplier of listed firms to calculate the valuation of target firm.We should correct the differences between target firm and listed firms.Eventually comparable companies to be evaluated,compared the difference have no business,only the difference between financial comparability.There are only finance differences between target firm with finally listed company and difference in business have to be eliminated.So we only need to correct the differences in finance in correct multiplier.The difference of financial divided into a quality,profit ability,debt paying ability,operation ability and development ability.And there are numerous financial indicators to reflect all aspects of the financial capacity,which bring certain difficulty multiplier value correction.Using some of the financial indicators as principal analysis components and constructing a value multiplier correction function to amend the value of the multiplier.