Target multiples

02-12

最近聽到有人問： how do you justify a P/E multiple? 我告訴他答案後，結果居然被告訴說這個面試問題已經難倒了無數人。記得以前準備面試的時候看過一篇primer專門講過target multiples, 分享一下我當時寫下來的筆記：

開玩笑的，當時的筆記我就不丟人現眼了，不過下面的圖是精髓，有興趣的朋友可以看看:

Note:

ROIC and ROE = incremental post-tax return on incremental total investment and equity

g = assumed

long-term growth rate

WACC = weighted average cost of capital

COE = cost of equity

T = effective tax rate

D = depreciation and amortisation as a % of EBITDA; M = operating margin

Word of caution:

These are based on limiting assumptions and should be used with care. For example, margins, depreciation, taxation and rate of investment are all assumed to remain constant, and growth is assumed to continue into perpetuity. As a result, multiples obtained using these formulas are likely to over- or understate fair value.

哈，看你面試還能不能問倒中國人！

有興趣讀全本的話，上網搜UBS Multiples Primer, 應該可以找到的