valuation multiples primer

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paragraph/paragraph: These fair or target multiples can be calculated, based on underlying drivers of return on capital, cost of capital and growth, using a discounted cash flow-equivalent approach.

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dcf 90%

The slide defines a fair multiple as one resulting in a net present value of zero, derived from cost of equity and future price curves.

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The slide uses a DCF-based logic to derive a 'fair' multiple retrospectively.